Currency (Purchasing Power Parity)

Hi,

I have watched the currency lectures and practised couple of questions and I want to double check if my understanding is correct regarding the calculation for purchasing power parity.

If the question stated Z is expected to receive 500,000 (Euro).
Z could put deposit in the European country at annual interest 3% and borrow at 5%
Company could deposit in its home currency at 4% and borrow at 6%.

Inflation in the European country is 3% per year and inflation in the home currency is 4.5%.

Spot rate is 2 Euro per $

So this would mean we do 2 (Euro) x 1.03 / 1.045 = 1.97

However if we assumed the home currency to be Euro then would it be:
2 (Euro) x 1.045 / 1.03

Thanks