Question 5: (7 points each) Suppose that two-year interest rates are 4.2% in the United States (US) and 1.2% in the United Kingdom (UK). The spot exchange rate is y.yy/$ (y.yy Dollars per British Pound. Please select a value larger than 1.33). Suppose that one year later interest rates are 3.5% in both countries, while the value of the British Pound has appreciated to v.vv/$ (This must be a value no less than 1.30). 1- A US Investor from New York invested in a U.S. two-year zero-coupon bond at the start of the period and sold it after one year. Assume that the face value of the zero-coupon bond is $100. What was his return?; 2- An investor from London, UK bought some dollars. The investor also invested in the two-year U.S. zero-coupon bond and sold it after one year. What was the return of the investor in British Pound