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Assume that the nominal annual interest rate is 3% in the Eurozone and 1% in the Japan and the current spot exchange rate (St) is

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Assume that the nominal annual interest rate is 3% in the Eurozone and 1% in the Japan and the current spot exchange rate (St) is 125.40/. Assuming interest rate parity holds, calculate exchange rate of the Yen versus the Euro (St+1) in one year. 125.20/ 127.88/ 104.55/ None of the answers is correct 122.97/ Sony of Japan produces tablets for 19,500 and exports them to the United States. Last year the exchange rate was 130/$ and Sony sold the tablets at $150 in the U.S. Currently the spot exchange rate is 110\/$ and Sony is charging $170 per tablet. What is the degree of pass through by Sony of Japan on their tablets? None of the answers is correct 59.09% 86.7% 73.3% 95.9%

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