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Question 2. A zero-coupon bill issued by the UK government with a face value of 2000...

Question 2. A zero-coupon bill issued by the UK government with a face value of 2000 pounds and matures in 3 months is currently trading at 1950 pounds. A similar bill, issued by the Swedish government has a face value of 100,000 Skr is selling at 96,000 Skr. Assume the British pound is currently trading at 12 Skr. Given this information, at what value, approximately, does the market believe the pound will trade at in 3 months’ time, assuming uncovered interest parity holds. Work this out the nearest 3 decimal points. Show and explain your work.
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