5. Topic: Covered Interest Arbitrage Assume the following: -You have $600,000 to Invest --Current spot rate on the New Zealand dollar is $1.50= NZS - The 90-day forward rate on NZ\$ is $1.50 -The 90-day interest rate in the U.S. is 6% - The 90-day interest rate in New Zealand is 8% A. Calculate the U.S. dollar possible gain (or loss) derived from covered interest arbitrage. B. What is the percentage yield on your $600,000 ? C. But of course, other investors are also interested in buying forward contracts, given the above information, causing the 90-day forward rate on the New Zealand dollar to quickly fall to say, \$1.39. How does this fact affect your U.S. dollar return prospects and percentage yield