Could you please help me solve this question?

C4. Suppose that the current exchange rate is $1.2 per 1, interest rate on 1-year euro- denominated bonds is 1% and interest rate on one-year U.S. bonds is 1.5%. International investors currently expect the exchange rate to be about $1.212 per 1 in one year. (a) [10 marks] Given the above information, would international financial investors shift their portfolios towards U.S. bonds, Euro bonds, or leave their portfolios as they are? Explain. (b) [10 marks] What is the current period equilibrium value of the nominal exchange rate? Should euro appreciate or depreciate from its current value of $1.2 to reach the equilibrium rate