A newspaper provides spot exchange rate of $1 = .7555 and 1-year forward rate of $1=.7755. Youll also need to use the additional information provided in the problems.

3. Suppose that the treasurer of Roll Royce has an extra cash reserve of 1,000 to invest for a year. The annual interest rate is 4.5% per annum in the US and 5% per annum in UK. The treasurer does not wish to bear any exchange risk and she uses the provided spot and forward quotes to transact. Where should she invest to maximize the return and how much will she get, 2 decimal places?