6. Suppose the current spot exchange rates are $1.15/, and $1.25/. Suppose also that a dealer quotes you 1.18/ . Is there a triangular arbitrage opportunity? Calculate your profit for $1M. starting amount.

8. a) If a country employs a currency board, all monetary policy is on autopilot. Explain this statement

b) What are the macroeconomic impacts of exchange rate appreciations/depreciations?

c) What is the main difference between direct and indirect interventions in foreign exchange markets?