Final answer:
(a), The Japanese yen is expected to weaken against the U.S. dollar, as the forward rate is higher than the spot rate.
(b), Estimating inflation rate differences from forward rates is complex and includes many economic factors. Historical exchange rate movements have had significant impacts on businesses and economies.
Step-by-step explanation:
If the spot rate for the yen is ¥101.14 and the three-month forward rate is ¥102.25, it implies that the yen is expected to weaken against the U.S. dollar in the next three months. This is because it would take more yen to buy one dollar in the future according to the forward rate than it does in the spot market.
Estimating the difference in inflation rates between the United States and Japan from the forward rate can be complex as it entails considering not just inflation but also interest rates, investors' expectations, and many other economic factors.
However, generally, if a currency is expected to weaken, it could be due to the country having relatively higher inflation rates or lower interest rates compared to the other country.
Regarding the historical exchange rates, the data shows that U.S. exchange rate movements in Japanese yen have been significant over time, affecting businesses and the economy. These movements reflected changes in investor sentiment, economic policies, and various macroeconomic factors.