Question: The interest rate in the U.K. is 8%, while the interest rate in the U.S. is 7%. The spot rate for the British pound is

The interest rate in the U.K. is 8%, while the interest rate in the U.S. is 7%. The spot rate for the British pound is $1.50. According to the international Fisher effect (IFE), the British pound should adjust to a new level of: A. $1.486. B. $1.521. C. $1.493. D. $1.577.

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