answer and explain

Question 4 1.2 points Save Assume the following holds at t=0: 1. The market expects the Dollar to nominally appreciate by 10% against the Euro over the next period 2. Australian expected inflation is 10% over the next period European expected inflation is 5% over the next period The real Dollar per Euro exchange rate is q = 1.1 What is the market's expectation of the real Dollar per Euro exchange rate at t=1? O A. The above information is not enough to calculate q O B. Approximately 1.14 O C. Approximately 1.045 O D. Approximately 0.935 O E. Approximately 1.265