If you use covered interest arbitrage for a 90-day investment, what will be the gain/loss of U.S. dollars you will have after 90 days? $37, 120 gain $25, 600 gain $25, 600 loss $37, 120 loss Assume that interest rate parity holds. The U. S, interest rate is 7%, and Canadian interest rate is 3% Subsequently, the Canadian interest rate increases to 5%. According to interest rate parity, the Canadian $ forward will discount; increase discount, decrease premium: increase premium; decrease Assume a two-country world: US and Country A. Which of the following is correct about purchasing power parity (PPP) as related to these two countries? If US's interest rate exceeds country A's inflation rate, U.s' currency will weaken If US's interest rate exceeds Country A's inflation rate, US's currency will strengthen. If Country A's inflation rate exceeds US's inflation rate, US s currency will weaken If US's inflation rate exceeds Country A's inflation rate, US's currency will weaken Assume that the inflation rate in Singapore is 4%, while the inflation rate in the U S is 1% According to PPP, the Singapore dollar should by % appreciate; 3.50 depreciate; 3 50 appreciate; 2.89 depreciate. 2.89 Given a US country and a foreign country, purchasing power parity (PPP) suggests that. USD will appreciate if the current US interest rate exceeds the current foreign interest USD will depreciate if the current US inflation rate exceeds the current foreign inflation USD will depreciate if the current US inflation rate exceeds the current foreign interest USD will appreciate if the current US inflation rate exceeds the current foreign inflation Assume that the U.S. inflation rate is higher than the Chinese inflation rate. This will consumers to their imports from Chinese and Chinese consumers to their U S According to purchasing power parity (PPP), this will result in a(n) of the reduce: increase; depreciation reduce: increase; appreciation reduce; increase; appreciation increase: reduce; appreciate