What is the one year forward rate predicted to be assuming interest rate parity holds true?

The interest rate on EUR deposits is 7%. The interest rate on GBP deposits is 5%. The spot rate is EUR/GBP0.8500.

What is the one year forward rate predicted to be assuming interest rate parity holds true?
A . 0.8662
B . 0.8341
C . 0.7500
D . 0.9633

Answer: B

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