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Telex corporation operates in three different markets Canada, New Zealand, and Mexico. Exactly one month from now, the company expects to receive substantial amounts in all three currencies. At the same time, the company is also required to make a significant sum of payments in the same currencies. The following table summarizes firms committed receipts and payments in one month.

Currency	Total Inflow	Total Outflow
Canadian dollars (C$)	50662000	10104000
New Zealand dollars (NZ$)	5052000	2805000
Mexican pesos (MXP)	3038000	15015000

Based on data for the last 60 months, it estimates the standard deviation of monthly percentage changes exchange rate for each currency against USD is produced below.

Currency	Standard Deviation	Spot Rate
Canadian dollars (C$)/US$	3.90%	$0.81
New Zealand dollars (NZ$) / US$	4.50%	$0.72
Mexican pesos (MXP) / US$	5.90%	$0.05

Moreover, the correlation coefficient among these currencies is produced below.

Currency	Canadian $	New Zealand $	Mexican Pesos
Canadian dollars	1
New Zealand dollars	0.78	1
Mexican pesos	0.47	-0.26	1

Based on the above information answer the following questions:

1. Using a 95% confidence level determine the maximum one-month loss for the committed receipts or payment individually in each currency (6 Marks)
2. Determine the maximum one-month loss for the company from the portfolio of receipts (6 Marks)
3. Is there any difference between total portfolio loss and the loss derived by adding the individual currency losses? Explain such differences (if any). (3 Marks).

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