An investor placed CAD 100,000 in an investment in the UK. The spot rate of CAD is 0.54 GBP, 90-day forward rate is 0.50 GBP. Moreover, the interest rates are 4% and 2.5%, on the CAD and GBP, respectively. Given the previous information, the investors percentage return when using covered interest arbitrage is:

Multiple Choice

• 13.7%

• 12.7%

• 10.7%