Paragraph 25. (5 marks) Suppose the spot exchange rate for the Canadian dollar / U.S. dollar is CAD 1.09 and the six-month forward rate is CAD 1.11 a) (1 mark) Which is worth more, Canadian or U.S. dollars? b) (1 marks) Assuming PPP holds, what is the cost in the United States of an Elkhead beer if the price in Canada is $2.50? Why might the beer actually sell at a different price in the U.S.? c) (1 mark) is the U.S. dollar selling at a premium or discount relative to the Canadian dollar? d) (1 mark) Which currency is expected to depreciate? e) (1 mark) Which country do you think has higher interest rates? Canada or the U.S