A student made the following statements regarding the Interest Rate Parity and Purchasing Power Parity relationships: to the Interest Rate Parity, a currency with a lower interest rate is expected to appreciate relative to a currency with a higher interest rate. Statement 2: According to the Power Purchasing Parity, a country with a lower inflation rate is expected to depreciate relative to a country with a higher inflation rate. Are the two statements correct or incorrect? A) Statement 1 is correct, statement 2 is incorrect B) Statement 1 is incorrect, statement 2 is correct. C) Both statements are correct. Both statements are incorrect