Assume the spot Dollar/Euro exchange rate is $1.35/€ and in one year you expect the exchange rate will be $1.5/€.
(I) Over the next year the US dollar is expected to appreciate against the euro.
(II) BMWs will be more expensive to US car buyers.
a) (I) is true; (II) is false
b) (I) is false; (II) is true
c) Both statements are true
d) Both statements are false