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Q 15-17: The current exchange rate is 1.20 S/ and interest rates are 1.80% in...

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Q 15-17: The current exchange rate is 1.20 S/ and interest rates are 1.80% in US and 3% in eurozone. Sometime later, the euro interest rate suddenly changes to 2% 14. According to Asset Market Theory, what will be the new expected rate? 15. According to Asset Mrket Theory, what will be the new spot rate? 2

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