4. This question concerns equilibrium in the foreign exchange market, as shown by gure 15-2 in the textbook. For each of the following explain whether the foreign return or domestic return will shift, and in which direction, and the effect on the spot exchange rate, (Eye). a. The euro is expected to appreciate versus the dollar in the future b. The Federal Reserve increases the US. interest rate 5. For each of the following, explain whether the US. return is greater, equal to, or less than the foreign (European) return. a. Ease =2,Ee=2.04, is;'=.03, lg 2.02 b. Em =4, 139:4.08, i$,-=.05, lg 2.03