calculations. On questions requiring calculations show all your work. Do not round any intermediate 1. Hart Enterprises, based in the United States, is comparing forecasting methods to use when determining whether to hedge its annual interest payment in Indonesia. Assume there are significant capital flows between the U.S. and Indonesia with funds flowing from countries with low interest rates and to countries with high interest rates. There are minimal trade flows between the U.S. and Indonesia. As a result capital flows between the two countries is the major factor influencing changes in the dollar-rupiah exchange rate with capital flowing to the highest interest rate. Hart also expects interest-rate parity to hold in the forward market. The current exchange rate is $0.00007 per rupiah. a. Assume iUS>indonesia and Hart uses the forward rate to forecast the expected spot. i. What will Hart forecast to be happening to the value of the rupiah? ii. Given the information about trade flows and capital flows, what do you expect to happen the value of the rupiah? b. Assume i S