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Suppose the spot exchange rate for the Hungarian forint is HUF 205.42. The interest rate in the United States is 2.5 percent per year and
Suppose the spot exchange rate for the Hungarian forint is HUF 205.42. The interest rate in the United States is 2.5 percent per year and is5.5 percent in Hungary. a. What do you predict the exchange rate will be in one year? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. b. What do you predict the exchange rate will be in two years? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16 . c. What do you predict the exchange rate will be in five years? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16
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