Deadline: May 9, 2021 1. If your friend argued that the current forward rate quoted on a currency pair is the market's expectation of where the future spot rate will end up, what would you say? Do you agree with her? What sort of methods can you use to forecast the future spot rates? Discuss for short- term and long-term. 2. There was a crash in the petrol prices in April 2020. Petrol prices saw the lowest levels in history, even the negative numbers in some contracts. Assume you are an oil producer. What instruments could you use before this crash to hedge your future income. Please explain in detail and use numbers if necessary. Answers