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Suppose the spot exchange rate for the Canadian dollar is Can$1.01 and the six-month forward...

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Accounting

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Suppose the spot exchange rate for the Canadian dollar is Can$1.01 and the six-month forward rate is Can$1.03 a. Which is worth more, a U.S. dollar or a Canadian dollar? b. Assuming absolute PPP holds, what is the cost in the United States of an Elkhead beer if the price in Canada is Can$3.10? (Round your answer to 3 decimal places, e.g 32.161) c. Is the U.S. dollar selling at a premium or a discount relative to the Canadian dollar? d. Which currency is expected to appreciate in value? e. Which country do you think has higher interest rates-the United States or Canada? a. b. Cost in U.S. dollars d. e

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