4. Suppose that there is perfect capital mobility between the U.S. and the UK, transaction costs in the foreign exchange market are negligible, and investors are risk-neutral. The yield curve (term structure of interest rates) is upward-sloping in the U.S. and downward- sloping in the UK. If this is all you know, what can you say about the expected change in the dollar-pound exchange rate E/s? (30%)