(a) Suppose the nominal interest rate in South Africa is 8% and the expected inflation is 6%. If expected inflation rate in Brazil is 12%. What should be the nominal interest rate in Brazil based on international parity relations? Identify the parity employed in your calculation. (b) Suppose the nominal interest rate is 8%, and the expected inflation rate is 4% in India. What is the real interest rate in India based on international parity relations? Identify the parity employed in your calculation. (3) (c) Suppose the spot exchange rate quote is R7.85/s. The nominal rate in the U.S. is 4% and the nominal interest rate in South Africa is 6%. Calculate the expected 6-month spot rate based on international parity relations. Identify the parity employed in your calculation. (3) (d) Suppose the spot exchange rate quote is R7.85/S. The nominal rate in the U.S. is 4% and the nominal interest rate in South Africa is 6%. Calculate the 2-year forward rate based on international parity relations. Identify the parity employed in your calculation. (3) (e) Suppose the spot exchange rate quote is R7.85/S. The nominal rate in the U.S. is 4% and the nominal interest rate in South Africa is 6%. Calculate the 2-year forward premium/discount for Rand and Dollar respectively based on your calculation in part (d) above. (4) (f) Suppose the monthly average consumer's basket costs R1,000 in South Africa and $125 in U.S. If the current rand-dollar spot rate is R9/\$, what will happen to the demand and supply for the two countries' goods and services according to absolute purchasing power parity? Explain your answer. (4) (a) Suppose the nominal interest rate in South Africa is 8% and the expected inflation is 6%. If expected inflation rate in Brazil is 12%. What should be the nominal interest rate in Brazil based on international parity relations? Identify the parity employed in your calculation. (b) Suppose the nominal interest rate is 8%, and the expected inflation rate is 4% in India. What is the real interest rate in India based on international parity relations? Identify the parity employed in your calculation. (3) (c) Suppose the spot exchange rate quote is R7.85/s. The nominal rate in the U.S. is 4% and the nominal interest rate in South Africa is 6%. Calculate the expected 6-month spot rate based on international parity relations. Identify the parity employed in your calculation. (3) (d) Suppose the spot exchange rate quote is R7.85/S. The nominal rate in the U.S. is 4% and the nominal interest rate in South Africa is 6%. Calculate the 2-year forward rate based on international parity relations. Identify the parity employed in your calculation. (3) (e) Suppose the spot exchange rate quote is R7.85/S. The nominal rate in the U.S. is 4% and the nominal interest rate in South Africa is 6%. Calculate the 2-year forward premium/discount for Rand and Dollar respectively based on your calculation in part (d) above. (4) (f) Suppose the monthly average consumer's basket costs R1,000 in South Africa and $125 in U.S. If the current rand-dollar spot rate is R9/\$, what will happen to the demand and supply for the two countries' goods and services according to absolute purchasing power parity? Explain your answer. (4)