Refer to the following scenario T=0 T=90 s0=$1.34/euer s90= $1.38/euer F0=$1.40/euer E(S90)=$1.33/Euer

1- if you listen to the market, what would you do? what is your profit or loss in that case?

2- if you listen to the expert , what would you do? what is your profit or loss in that case?

3- which forecast make better prediction in terms of precision and direction?

4- which forecast make better prediction in terms of profit generation?

5-Can you reconcile your answers to III and iv Elaborate.