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As of today, the spot exchange rate is $1.25 / , and the rates of inflation expected to prevail for the next year is 2.5%

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As of today, the spot exchange rate is $1.25 / , and the rates of inflation expected to prevail for the next year is 2.5% for the United States, and 2.1% for Eurozone. What is the one-year forward rate under which there will be no arbitrage

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