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Suppose the spot exchange rate for the Hungarian forint is HUF 213. Interest rates in the United States are 4.9 percent per year. They are 6.8 percent in Hungary. Use the approximate interest rate parity equation to answer this question.
What do you predict the exchange rate will be in one year? In two years? In five years? (Do not include the Hungarian forint sign (HUF). Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
Exchange rate
One year HUF
Two years HUF
Five years HUF
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