20. Suppose that the one-year interest rate is 3.0 percent in the Italy, the spot exchange rate is $1.20/, and the one-year forward exchange rate is $1.18/. What must one-year interest rate be in the United States?

a) 1.2833%

b) 1.0128%

c) 4.75%

d) None of the above

**The answer should be a) 1.2833%. I can't figure out the algebra used to determine that answer though.