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3. Assume the u.S.Interest rate Is T0 percent, and the Interest rate on euro deposits IS 5 percent. For the following exchange rates, find the

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3. Assume the u.S.Interest rate Is T0 percent, and the Interest rate on euro deposits IS 5 percent. For the following exchange rates, find the forward exchange rates Today's Dollar/Euro Exchange Rate E/E Forward Exchange Rate F$/E 1.05 1.1 1.2 For the following 15 cases, compare the dollar rates of return on dollar and euro deposits. Expected Rate of Dollar Depreciation Against Eur Rate of Return Difference Between Dollar and Euro Dollar Interest Rate, R Euro Interest Rate, RE 0.06 0.06 0.06 0.12 0.18 0.06 0.06 0.06 0.12 0.18 0.06 0.06 0.06 Case eposits 0.1 0.1 0.1 0.1 0.1 0.15 0.15 0.15 0.15 0.15 0.2 0.2 0.2 0.04 0.08 0.04 0 0 0.04 0.08 0.04 4 10 12 13 0.04 0.08

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