QUESTION 2 (UNIT 2) (25 MARKS) Forecast Change in Spot Rate Forward Premium/Discount Forecast Difference in Rate of inflation Difference in Nominal Interest Rate Figure 1: International Parity Conditions in Equilibrium Based on figure 1, illustrates your own hypothetical examples of the fundamental parity relations exist in a) Relation 1: Purchasing Power Parity b) Relation 2: The Fisher Effect c) Relation 3: The International Fisher Effect d) Relation 4: Interest Rate Parity e) Relation 5: Forward as Unbiased Predictor (25 marks)