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3. Consider the currency arbitrage between Home FX market and Foreign FX market. In Home FX market, the exchange rate is EH = 5CH/CF. In

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3. Consider the currency arbitrage between Home FX market and Foreign FX market. In Home FX market, the exchange rate is EH = 5CH/CF. In Foreign FX market, the exchange rate is 4CH/CF or 6CH/CF. Taking the advantage of this difference, the currency trader started the currency arbitrage and bought Home currency in Home FX market. Answer which is the exchange rate in Foreign FX market: 4CH/cF or 6CH/CF, and answer how Home currency in Foreign FX market would change: Appreciate or Depreciate. E in Foreign FX market: 4CH/CF or 6CH/CF Change of CH in Foreign FX market: Appreciate or Depreciate

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