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Suppose the spot and three-month forward rates for the yen are 85.14 and 84.61, respectively. (Enter your answer as directed, but do not round intermediate
Suppose the spot and three-month forward rates for the yen are 85.14 and 84.61, respectively. (Enter your answer as directed, but do not round intermediate calculations.) |
Required: |
(a) | Is the yen expected to get stronger or weaker? |
(Click to select)StrongerWeaker |
(b) | What would you estimate is the difference between the inflation rates of the United States and Japan?(Negative amount should be indicated by a minus sign. Round your answer to 2 decimal places (e.g., 32.16).) |
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