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Assume that the Mex can peso currently trades at 1 1 pesos to the US dollar During the year U S inflation is expected to

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Assume that the Mex can peso currently trades at 1 1 pesos to the US dollar During the year U S inflation is expected to average 4%, while Mexican inflation is expected to average 6%. What is the current value of one peso in terms of US dollars? Given the relative inflation rates, what will the exchange rates be 1 year from now? Which currency is expected to appreciate and which currency is expected to depreciate over the next year? The current value of one Mexican peso in terms of U.S. dollars, USS, is USS MP (Round to six decimal places.) Given the relative infilation rates, the exchange rate of one U.S. dollar in terms of Mexican pesos, MP one year from now wil be MPUSS, (Round to sik declimal places.) Given the relative inflation rates, the exchange rate of one Mexican peso in terms of U S dollars, USS, one year from now will be US$ MP (Round to six decimal places.) The 1 is expected to appreciate, while the is expected to depreciate over the next year (Select from the drop-down menus.)

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