5.A d ecision to hedge receivables in the money market will be taken if A: B: C: D: the interest parity forward rate is lower than the expected spot rate. E: the domestic interest rate is higher than the foreign interest rate. the domestic interest rate is lower than the foreign interest rate. the interest parity forward rate is higher than the expected spot rate. the interest parity forward rate is equal to the expected spot rate. At the beginning of 2002 the AUD/USD exchange rate was 1.9585 and the 2002 inflation rates were 3.30% for Australia and 2.33% for the US, what should the AUD/USD exchange rate have been at the end of 2002, according to the approximate calculation of Relative PPP theory? A: USD/AUD 0.5068 4. B: AUD/USD 1.9736 C: AUD/USD 1.9775 D: USD/AUD 1.8769 E: USD/AUD 0.8467