$1.$ Assume the following in formation:

BEAL BANK YARDLEY BANK

Bid price of New Zealand dollar $$0\mathrm{.}402$ $$0\mathrm{.}397$

Ask price of New Zealand dollar $$0\mathrm{.}405$ $$0\mathrm{.}400$

Given this information, is locational arbitrage possible? If so$,$ explain the steps involved in locational arbitrage, and compute the profit from this arbitrage if you had $$1$ million to use. What market forces would occur to eliminate any further possibilities of locational arbitrage?

$2.$ Assume the following information:

BID PRICE ASK PRICE

Value of Canadian dollar in U$.$S$.$ dollars $$0\mathrm{.}90$ $$0\mathrm{.}92$

Value of New Zealand dollar in U$.$S$.$ dollars $$0\mathrm{.}30$ $$0\mathrm{.}32$

Value of Canadian dollar in New Zealand dollars NZ$ $3\mathrm{.}04$ NZ$ $3\mathrm{.}10$

Given this information, is triangular arbitrage possible? If so$,$ explain the steps that would reflect triangular arbitrage, and compute the profit from this strategy if you had $$1$ million to use. What market forces would occur to eliminate any further possibilities of triangular arbitrage?

$3.$ Assume the following information:

Spot rate of Canadian dollar $=$ $$\mathrm{.}80$

$90-$day forward rate of Canadian dollar $=$ $$\mathrm{.}79$

$90-$day Canadian interest rate $=4\%$

$90-$day U$.$S$.$ interest rate $=2\mathrm{.}5\%$

Given this information, what would be the yield $($per$-$ centage return$)$ to a U$.$S$.$ investor who used covered interest arbitrage? $($Assume the investor invests $$1$ million.$)$ What market forces would occur to eliminate any further possibilities of covered interest arbitrage?