QUESTION 6 Assume that you believe strongly in purchasing power parity and that arbitrage opportunities efficiently align spot exchange rates. Assume further that the current spot rate of the British pound is $1.50, while the current spot rate of the Canadian dollar is 0.4 pounds. The expected Inflation over the next year is 8% in the U.K, 6% in Canada, and 3% in the U.S. The one year interest rate is 7% in the U.K.3% in Canada, and 5% in the U.S. A) Determine the expected spot rate of the Canadian dollar in one year with respect to the U.S. dollar? Show your work. B) You plan to import from Canada and will need 20 million Canadian dollars in one year. Determine the expected amount of U.S. dollars to be paid by you for the Canadian dollars in one year