Assume that the interest parity condition holds. If the domestic interest rate is 12% and the foreign interest rate is 9% then given this information, we would expect that:

Select one:

a.the domestic currency is expected to appreciate by 3%.

b.the foreign currency is expected to depreciate by 3%.

c.individuals will only hold domestic bonds.

d.the domestic currency is expected to depreciate by 3%.

e.individuals will only hold foreign bonds.