What percentage appreciation or depreciation

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Assume that the three-year annualized interest rate in the United States is 5 percent and the three-year annualized interest rate in Canada is 5.5 percent. Assume interest rate parity holds for a three-year horizon. Assume that the spot rate of the Canadian dollar is $.98. If the forward rate is used to forecast exchange rates, what will be the forecast for the Singapore dollar’s spot rate in three years? What percentage appreciation or depreciation does this forecast imply over the three-year period?

Reference no: EM131863003

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