8 You are given the following information: Spot exchange rate Expected euro area inflation rate for next

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8 You are given the following information:

Spot exchange rate Expected euro area inflation rate for next Expected Japanese inflation rate for next Three-month money market interest rate for the Three-month money market interest rate for On the basis of these figures calculate:

(a) the real exchange rate of the yen against the euro; and

(b) the approximate three-month forward exchange rate of the yen against the euro.

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