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3. Suppose you are a US-based investor and you observe the following: The spot rate S(S/CHF)=1.1045 and the 6-month forward rate is F6(S/CHF)=$1.110. The annualized

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3. Suppose you are a US-based investor and you observe the following: The spot rate S(S/CHF)=1.1045 and the 6-month forward rate is F6(S/CHF)=$1.110. The annualized nominal interest rate is 5.5% in the U.S. and 2% in Switzerland. Is covered interest arbitrage possible? If it is possible, describe the steps you would take to conduct it and calculate the arbitrage profit if you can borrow $$2,250 or $00,000CHF. If you only show calculations, you will not receive full credit

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