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Estimation of the us dollar future appreciation

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Suppose the nominal interest rate in the united states is 3.5% and the nominal interest rate in Canada is 4% [Hint: home is the United States]

A. give an approximate estimation of the U.S. Dollar's future appreciation or depreciation.

B. Suppose the spot rate today is $1.15/CAD. what should the future exchange rate be in five years according to IFE [Hint; base on approximate estimation]

Reference no: EM133074429

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