4.19 On January 1, 1994, the annual inflation rates in the U.S. and Italy were expected be 4% and 7%, respectively. Ifthe current spot rate on that day was $1-12,000, then the expected spot rate for the lira in three years was a) $.0004591 b) $.0011590 c) $.0009892 d) $.0005471 ,-2000 (1+0,0 )3 1004) Ans: a