3. According to the following information there is an arbitrage opportunity: Spot exchange rate S(S/) 1.30 360-day forward rate F360(S/) 1.33 U.S. discount rate is 6% Euro discount rate i(-4% Which of the following is not part of the adjustment process that rebalances the equilib- rium condition? 1) is UP 2) i DOWN 3) S UP (stronger Euro) 4) F UP (stronger Euro)