Suppose inflation rates in the US and Spain are expected to be 4.66.pdf

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Suppose inflation rates in the US and Spain are expected to be 4.66% and 7.92%, respectively. Next year economists expect that they will be 11.99% and 5.25%, respectively. If the current spot rate is USD0.8054/EUR, then what is the expected spot value in one years time and in two years time? a. USD0.7811/EUR and USD0.8311/EUR b. USD0.8304/EUR and USD0.7341/EUR c. EUR1.2041/USD and EUR1.3623/USD d. EUR1.2811/USD and EUR1.1932/USD.

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