Suppose that you want to use the forward rates to obtain a forecast of the Mexican peso U.S. dollar spot exchange rate for each of the next 5 years. The following table shows the annual deposit interest rates in the United States and in Mexico.The Mexican peso-U.S. dollar spot exchange rate is Peso20.0000/$. Given that interest rate parity holds, complete the table with the Mexican peso-U.S. dollar forward rate and your forecast of the Mexican peso- U.S. dollar spot rate for each of the next five years.

	Interest Rates (Mexico)	Interest Rates (U.S.)	Forward Rate	Forecast of Spot Rate
1 year	10.5%	1.5%
2 years	11.5%	2.0%
3 years	12.5%	2.5%
4 years	13.0%	3.0%
5 years	15.0%	5.0%