Two countries, the United States and England, produce only one good wheat. Suppose the price of wheat

Question:

Two countries, the United States and England, produce only one good wheat. Suppose the price of wheat is $3.25 in the United States and is £1.35 in England.
a. According to the law of one price, what should the $:£ spot be?
b. Suppose the price of wheat over the next year is expected to rise to $3.50 in the United States and to £1.60 in England. What should the one-year $:£ forward rate be?
c. If the U.S. government imposes a tariff of $0.50 per bushel on wheat imported from England, what is the maximum possible change in the spot that could occur?

Exchange Rate
The value of one currency for the purpose of conversion to another. Exchange Rate means on any day, for purposes of determining the Dollar Equivalent of any currency other than Dollars, the rate at which such currency may be exchanged into Dollars...