Assume the following information is available for the United States and Europe: a. Does IRP hold? b.
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Assume the following information is available for the United States and Europe:
a. Does IRP hold?
b. According to PPP, what is the expected spot rate of the euro in 1 year?
c. According to the IFE, what is the expected spot rate of the euro in 1 year?
d. Reconcile your answers to parts
(a) and (c).
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