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QUESTION

As of today, the spot exchange rate is 1.00 = $1.25 and the rates of inflation expected to prevail for the next three years in the U. is 2% and 3% in...

As of today, the spot exchange rate is €1.00 = $1.25 and the rates of inflation expected to prevail for the next three years in the U.S. is 2% and 3% in the euro zone. What spot exchange rate should prevail three years from now?

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