You are provided with the following information on spot exchange rates, the 3-month interest rate on Australian dollar and the 3-month interest rates on Swiss franc Spot exchange rate (AUD/CHF) Australian three-month interest rate Swiss three-month interest rate 1.1500 10.8% pa. 6.5% p.a. 21. IF UIP holds precisely, what will be the three-month interest parity exchange rate (AUD/USD)? AUD/CHF 1.1613 AUD/CHF 1.1615 C: AUD/CHF 1.1713 D: AUD/CHF 1.1619 AUD/CHF 1.1622 22. If UIP holds precisely, what will be the net interest differential on domestic and foreign assets? 0.00857 0.00863 0.00984 D 0.01058 0.00290 23. IFUIP holds precisely, what will be the gross interest differential on domestic and foreign assets? 1.01000 1.01058 1.00984 1.00353 1.00290 24. If the three-month expected rate is 1.18, a currency speculator can make a per unit risky profit of by going short on the Australian dollar, long on the Swiss franc and covering his long position in Swiss franc via a forward contract. A: 0.16511 B: 0.02151 C: 0.03584 D: 0.03677 E: 0.01905 25. At the beginning of 2002 the AUD/USD exchange rate was 1.9585 and the 2002 inflation rates were 3.30% for Australia and 2.33% for the US. What should the AUD/USD exchange rate have been at the end of 2002, according to the approximate calculation of Relative PPP theory? A: USD/AUD 0.5068 B: AUD/USD 1.9736 C AUD/USD 1.9775 D: USD/AUD 1.8769 E: USD/AUD 0.8467