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6. Assume that you obtain a quote for a one-year forward rate on the Argentinian peso. Assume that Argentinas one-year interest rate is 50 percent,

6. Assume that you obtain a quote for a one-year forward rate on the Argentinian peso. Assume that Argentinas one-year interest rate is 50 percent, while the U.S. one-year interest rate is 10 percent. Over the next year, the peso depreciates by 25 percent. Do you think the forward rate overestimated the spot rate one year ahead in this case? Explain.

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