1. Sam Diggo, a foreign exchange trader at Credit la de Franco (Paris), is exploring covered interest arbitrage possibilities. He wants to invest Euro 5,000,000 or its U.S. S equivalent in a covered interest arbitrage between US dollars and European Euro. He faced the following exchange rate and interest rate quotes: (CLO 4) Assumptions Value US $ Equivalent Arbitrage funds available 5,000,000 $ 13,500,000 Spot rate (0/5) 2.700 180-day forward rate (1/5)2.900 180-day US dollar interest rate 6.800% 180-day European Euro interest rate 5.400% Advise Sam Diggo If the covered interest Arbitrage is possible or not? If possible, where he should invest