Annum in France. Assume that you can borrow up to $1,000,000 or 1,060,000

A) Show how to realize a certain profit via CIA assumig that you want to realize profit in terms of dollars. Also determine the size of your arbitrage profit.

b) Assume that you want to realize profit in terms of euros. Show the CIA process and determine the profit in euros

Suppose that the current spot exchange rate is e0.65/S and the three-month forward exchange rate is 0.64/S. The three-month interest rate is 5.6 percent per annum in Canada and 5.4 percent per 4