Question: Question 2: You have been given the foreign exchange data for Kenya against US dollars as follows: The macroeconomic variables for Kenya and US at

Question 2: You have been given the foreign exchange data for Kenya against US dollars as follows: The macroeconomic variables for Kenya and US at the time were: Required: a) Compute mean rates for each of the markets, A and B. (5 Marks) b) Compute the Bid/Ask spread for both markets, A and B. (5 Marks) c) Using interest rate parity theorem, compute the exchange premium or discount. (5 Marks) d) Determine the forward rates for each of the markets: (5 Marks) (Total: 20 Marks)

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