If US Prices Are Expected to Rise by 3% Over the the Coming

question 26

Multiple Choice

If U.S. prices are expected to rise by 3% over the coming year and prices in Switzerland are expected to rise by 7% during the same time, what is the expected spot rate in one year of the Swiss franc given that the current spot exchange rate is $0.168?

• A) $0.1612
• B) $0.1613
• C) $0.1617
• D) $0.1745

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