Question: Forecasting with a Forward Rate Assume that the 3-year annualized interest rate in the United States is 6% and the 3-year annualized interest rate in

Forecasting with a Forward Rate Assume that the 3-year annualized interest rate in the United States is 6% and the 3-year annualized interest rate in Singapore is 4%. Assume interest rate parity holds for a 3-year horizon. Assume that the spot rate of the Singapore dollar is $.75. If the forward rate is used to forecast exchange rates, what will be the forecast for the Singapore dollars spot rate in 3 years? What percentage appreciation or depreciation does this forecast imply over the 3-year period? (1 points)

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