Suppose we observe the following 1-year interest rates: is = 5%, ISp = 2% The exchange rate is quoted as the dollar price of Swiss francs and is currently 0.40 i.e. E/ =0.40. SF (a) (2) Given the information above, use the covered interest parity relationship to calculate the 12-month forward rate? (b) (2) Suppose the actual 12-month forward rate is not what you found from (a), but instead is $0.40. What would profit-seeking arbitrageurs do