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5. Suppose the US dollar yen spot rate is $0.010, and one yen buys $0.0115 in the 1- year forward exchange market. The nominal interest rates for a 1-year risk-free security in Japan and in the U.S. are 2% and 4% respectively, a. Using the IRP equation, calculate the no-arbitrage forward rate for Japanese Yen (JPY). Given the quoted forward rate of $0.0115, does the Interest Parity relationship hold? Explain. b. Is there a forward rate premium or discount for JPY in this case? Will you expect Yen to appreciate or depreciate over the next 12 months? c. Using the quoted forward rate of $0.0115 and taking an initial investment of $1,000, show which security provides higher return. Support your answer with appropriate calculations