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Assume the interest rate is 4%in the US and 3%in Euroland. Which of the following statements about UIP are correct? UIP will never hold for

Assume the interest rate is 4%in the US and 3%in Euroland.

Which of the following statements about UIP are correct?

UIP will never hold for these numbers.

UIP predicts that the dollar is expected to appreciate by 1%.

UIP predicts that the dollar is expected to depreciate by1%

If the expected rate of depreciation of the dollar is 1%, then UIP holds.

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