The interest rate on one$-$year risk$-$free bonds is $4\mathrm{.}25$ percent in the United States and $3\mathrm{.}75$ percent in Switzerland. The current exchange rate is $$0\mathrm{.}65$ per Swiss franc. Suppose that you are a U$.$S$.$ investor and you expect the Swiss franc to appreciate by $2\mathrm{.}75$ percent over the next year.

a$.$ Calculate the foreign currency risk premium.

b$.$ Calculate the domestic currency return on the foreign bond, assuming that your currency appreciation expectations are met.Z