An individual has the possibility of borrowing $85,000 or 50,000. Transactions costs are zero. one-year interest rate on $: 5.80% (annual) one-year interest rate on

An individual has the possibility of borrowing $85,000 or £50,000. Transactions costs are zero. one-year interest rate on $: 5.80% (annual) one-year interest rate on £: 4.60% (annual) spot exchan...