Question: (e) Assume forex market equilibrium is given by i = ([1/E] 1) + 0.15 , where the two foreign return terms on the right are

(e) Assume forex market equilibrium is given by i = ([1/E] 1) + 0.15 , where the two foreign return terms on the right are expected depreciation and the foreign interest rate. What is the foreign interest rate? What is the expected future exchange rate?

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