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9. Derek Tosh is attempting to determine whether U.S./Japanese financial conditions are at parity. The current spot rate is a flat USD/JPY89.0000, while the 360-day

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9. Derek Tosh is attempting to determine whether U.S./Japanese financial conditions are at parity. The current spot rate is a flat USD/JPY89.0000, while the 360-day forward rate is USD/JPY84.9000. Forecast inflation is 1.100% for Japan, and 5.900% for the United States. The 360-day Euro-yen deposit rate is 4.700%, and the 360-day Eurodollar deposit rate is 9.500%. Assume 30/360 day count. a) Diagram and calculate whether international parity conditions hold between Japan and the United States. b) Find the forecasted change in the Japanese yen/U.S. dollar (\/$) exchange rate one year from now

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