Suppose the spot exchange rate for the U.S. dollar is CAD$1.01 and the six-month forward rate is CAD$1.03. a. Which is worth more, a U.S. dollar or a Canadian dollar? multiple choice 1 U.S. dollar...

Suppose the spot exchange rate for the U.S. dollar is CAD$1.01 and the six-month forward rate is CAD$1.03.

a.
Which is worth more, a U.S. dollar or a Canadian dollar?

multiple choice 1

• 
  

  U.S. dollar

  
  


• 
  

  Canadian dollar

  
  

b.
Assuming absolute PPP holds, what is the cost in the United States of an Elkhead beer if the price in Canada is CAD$3.10?(Round the answer to 2 decimal places. Omit $ sign in your response.)

Cost in U.S dollar           $

c.
Is the U.S. dollar selling at a premium or a discount relative to the Canadian dollar?

multiple choice 2

• 
  

  Discount

  
  


• 
  

  Premium

  
  

d.
Which currency is expected to appreciate in value?

multiple choice 3

• 
  

  Canada dollar

  
  


• 
  

  U.S. dollar

  
  

e.
Which country do you think has higher interest rates—the United States or Canada?

multiple choice 4

• 
  

  U.S.

  
  


• 
  

  Canada

  
  

please do all parts