The forecasting equation for the exchange rate between the Kenya shilling and the US dollar is given by: Yt = a + b1tX1t +b2tX2t +e Where Yt is the direct quote for period t X1t is the inflation rate differential between Kenya and the US for period t X2t is the interest rate differential between Kenya and the US for period t Assume historical data has been collected and presented as follows: MONTH INFLATION RATE INTEREST RATE EXCHANGE RATE DIFFERENTIAL DIFFERENTIAL 1 12 4.5 84 2 10 6.0 97 3 15 3.5 92 4 16 3.8 90 5 11 2.9 89 6 9 3.0 90 7 14 4.2 96 a) Using the multiple linear regression method, develop a forecasting model