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Exercise 4 Suppose that there are new fees associated 1with foreign exchange transaction. Each time a cnurrencg,r trade is made, the currency hroher takes 1%

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Exercise 4 Suppose that there are new fees associated 1with foreign exchange transaction. Each time a cnurrencg,r trade is made, the currency hroher takes 1% of the transaction as a fee. Derive an equation fer uncovered interest parit].r {HIP} in. this environment. For concretenessI use the dollar yen exchange rate, Ewe. For this question, do not use the approximation of the UIP

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