.Assume purchasing power parity holds between the US and Nigeria. If the spot rate is about N360/S. If Nigeria continues to have 15% inflation and the US continues to have 2% inflation, what would you expect to happen to the spot rate one year from now? (For full credit tell me which will appreciate/depreciate. For extra credit, tell me the number. Hint: See the principles videos on purchasing power parity) 9.If the Canadian dollar is trading at 0.75USD/CAD in the spot market and 0.748USD/CAD in the 1-month forward market, is the Canadian dollar trading at a premium or a discount? How much of one? 10.If one dollar will buy 13,300.50 Indonesian Rupiahs in the spot market and at 13,327.51 in the 3- month forward market, is the Indonesian Rupiah trading at a premium or a discount? How much of one? 11. Suppose WalMart has a contract to pay ¥200,000 in three months to a Japanese supplier. List two ways Walmart could hedge against the risk of dollar depreciation before then.

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