he exchange rate between the Mexico Peso (MXN) and the Australian Dollar (AUD) is 6.13 MXN/AUD today.
Question 1: An economist expects the MXN to appreciate by 33.3% over the next year. What exchange rate is he forecasting?
Question 2: A second economist expects the AUD to depreciate by 25%. What exchange rate is she forecasting?
Question 3: Do the economists agree? Explain.
Question 4: A year ago, the exchange rate was 6.3 MXN/AUD. Which economist believes that there is a continuing trend in the development of the exchange rate and which economist believes that there is a reversal in the development of the exchange rate?