The current spot exchange rate between the Euro and the Dollar is $1=$ $$1\mathrm{.}07.$ The $12-$month forward exchange rate is $1=$ $$1\mathrm{.}05.$ Assume you are an American investor planning to invest in EU bonds. The interest rate in the EU $($EU bonds$)$ is $5\%$ per year. Describe the transactions to compute the returns to invest in EU bonds for a year.