What is the expected exchange rate five years

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Reference no: EM13935152

The spot rate on the Canadian dollar is 1.24. Interest rates in Canada are expected to average 2.8% while they are anticipated to be 3.1% in the U.S. What is the expected exchange rate five years from now? (Please explain the calculation.)

a. 1.20

b. 1.22

c. 1.24

d. 1.25

e. 1.16

Reference no: EM13935152

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