Andi is considering investing $1000 in Canada, where she expects an interest rate of 3 percent, or in the U.K., where the expected interest rate would be 5 percent. The current exchange rate is 0.6 £/$, which could take by the end of the year any value between 0.4 and 0.7£/$ with equal probability. What should Andi do?

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The Answer of Andi is considering investing $1000 in Canada, where she expects an interest rate of 3 percent, or in the U.K., where the expected interest rate would be 5 percent. The current exchange rate is 0.6 £/$, which could take by the end of the year any value between 0.4 and 0.7£/$ with equal probability. What should Andi do?

Andi Is Considering Investing $1000 in Canada, Where She Expects