Abritish firm and a u. s. corporation each wish to enter into a currency swap hedging agreement. the british firm is receiving u. s. dollars from sales in the u. s. but wants pounds. the u. s. firm is receiving pounds from sales in britain but wants dollars. which of the following choices would best satisfy the desires of the firms?

a. the british firm pays dollars to a swap dealer and receives pounds from the dealer. the u. s. firm pays pounds to the swap dealer and receives dollars.
b. the u. s. firm pays dollars to a swap dealer and receives pounds from the dealer. the british firm pays pounds to the swap dealer and receives dollars.
c. the british firm pays pounds to a swap dealer and receives pounds from the dealer. the u. s. firm pays dollars to the swap dealer and receives dollars.
d. the british firm pays dollars to a swap dealer and receives dollars from the dealer. the u. s. firm pays pounds to the swap dealer and receives pounds.

Monthly price data for mdltx and ekwax from yahoo finance is contained in the excel spreadsheet for this exercise. there are 37 months of price data for the period from september 2009 to september 2012. (note: these prices already incorporate dividend payments.) the 36 monthly returns for each fund are also provided. calculate average (arithmetic) monthly return and standard deviation for each fund. you can use the excel functions average, stdev to derive these stats. annualize these statistics. use the correl function in excel to derive the correlation coefficient between the two sets of returns. (annual correlation is the same as monthly correlation. hence, no need to annualize this stat.) using the annualized statistics derived in step 1, compute the expected return and standard deviation for portfolios containing from 0% to 100% mdltx (and 100% to 0% ekwax) by 10% increments. graph the resulting portfolios. based on your analysis, is there any potential benefit to diversification across these two funds? explain. of the 11 portfolios you graphed, which are efficient?