File Vault 2 and Dropbox

I am bit confused about how dropbox works with encrypted files using File Vault 2. My MBA is encrypted using FV2...

Q1: therefore my dropbox folder which is in my MBA's home folder is also encrypted?

If so, Q2: then my dropbox data in the "cloud" is also encrypted?

Consequently, Q3: my dropbox folder on my other computer (iMac) should also encrypted?

In that case, Q4: how can my iMac read the dropbox files in its home folder when FV2 is not activated on the iMac?

Right now everything is working fine, but I do not understand how it is possible! ... please do not answer that it is "Magic"

Thanks


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If needed here is a summary of my set up:

a) Because I am always a bit distrustful of cloud syncing w/o intervention my work is done on local folders (in my home directory) and then synced to my dropbox folder using "SuperFlexibleSynchronizer". My dropbox directory is also in my home folder.

b) my MBA is encrypted using FV2, my iMac is not

c) basically this is how I sync my work with the two computers:

MBA --synced to--> dropbox folder on MBA --- dropbox cloud syncing automatically --> dropbox folder on iMac --synced to--> iMac and vice versa

 

Thank you, makes a lot of sense!

I am impressed by how transparent all the process is!