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Questions 35-39 are based on the following information: In October 2013, there is a consensus in the capital market that the annual inflation rate is
Questions 35-39 are based on the following information: In October 2013, there is a consensus in the capital market that the annual inflation rate is likely to be 3.5% in US and -1.5% in China for the next two years. Based on this information, answer the following questions regarding your prediction on foreign exchange rate. Using the exact version of the PPP, the forward rate in October 2015 (two years from 2013) is CNY /$. (Please use indirect quote and leave 3 decimal points) (2 points) Questions 35-39 are based on the following information: In October 2013, there is a consensus in the capital market that the annual inflation rate is likely to be 3.5% in US and -1.5% in China for the next two years. Based on this information, answer the following questions regarding your prediction on foreign exchange rate. Using the exact version of the PPP, the forward rate in October 2015 (two years from 2013) is CNY /$. (Please use indirect quote and leave 3 decimal points) (2 points)
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