3. If U.S. inflation is 3% and U.K. inflation is 8%, what should be the approximate nominal change in the value of the dollar over this time, according to relative PPP? (indicate appreciation or depreciation) The idea for the approximation is for you to intuitively think about what the answer should be, logically, in the context of what relative PPP says about the situation. And answer with an integer. You're missing the point if you go and "find the formula" and plug in the numbers. RPPP says that the dollar should by approximately % 4. Interest rates are 6% in the U.S. Interest rates are 8% in Europe. You observe me investing in the U.S. at 6%, foregoing the higher interest rate in the Europe. What can you infer about what I am expecting the to do over this next year? Doug is expecting the Euro to by at least %