macro questions

Suppose that the uncovered interest parity condition holds and the expected exchange rate between the euro and the dollar in one year is 1.50 (1 = $1.50). Using the exact formula, determine the current EUR/USD exchange rate when the interest rate is 4% in the Euro area and 5% in the USA. (Answer using 4 decimal places) Answer: In an open economy context, an increase in the domestic interest rate (i), will (ceteris paribus) lead to Select one: Q a. keep domestic output (Y) unchanged b. an appreciation of the domestic currency c. a depreciation of the domestic currency d. keep the exchange rate unchanged 0000 e. increase output (Y) Assume the following; 1. The interest rate in the Euro area is 4%; 2. The interest rate inJapan is 2%; 3. The current nominal exchange rate is 165 (1 = 165 Yen); 4. The expected nominal exchange rate next year is 155. Using the information above answer the following question: What is the expected rate ofappreciation or depreciation of the Euro? (precede the number with a + or minus to denote appreciation or depreciation, respectively, and use 2 decimal places - e.g +0.12 to mean an appreciation of 12%)