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In the spot market, $1 is currently equal to A$1.42. The expected inflation rate is...

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Finance

In the spot market, $1 is currently equal to A$1.42. The expected inflation rate is 3 percent in Australia and 2 percent in the U.S.. What is the expected exchange rate one year from now if relative purchasing power parity exists?

Group of answer choices

A$1.4342

A$1.4484

A$1.4062

A$1.4058

Answer & Explanation Solved by verified expert
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