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If the domestic and the foreign interest rates are 12% and 10% respectively, then according to...

  1. If the domestic and the foreign interest rates are 12% and 10% respectively, then according to the interest rate parity condition, which of the following is true?
    1. Foreign currency is expected to appreciate by 20%
    2. Foreign currency is expected to appreciate by 2%
    3. Foreign currency is expected to depreciate by 20%
    4. Foreign currency is expected to depreciate by 2%
    5. Foreign interest rates are expected to increase by 2%

I just confused about b and d

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