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1. The Spot Exchange Rate is $ 1 = US$ 0.7661. Assume that the 9 month C$ interest rate is 4.68%. What should the 9

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1. The Spot Exchange Rate is $ 1 = US$ 0.7661. Assume that the 9 month C$ interest rate is 4.68%. What should the 9 month forward exchange rate be if the 9 month US$ interest rate is: a. 3.88% b. 4.12% C. 4.68% d. 4.73% e. 5.19% 2. Refer back to question 1. Assume that the quoted 9 month forward rate was c$ 1 = US$ 0.8005. How much money would you make through arbitrage in each of the above scenarios? Assume that you can borrow up to $10,000,000 in either currency and likewise trade in spot and forward contracts

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