Assume that annual interest rates are 8 percent in the United States and 4 percent in Japan. The interest rates are continuously compounded. An FI can borrow (by issuing CDs) or lend (by purchasing CDs) at these rates. The spot (t=0) rate is USD 0.0080 per one JPY. Suppose that, at time t=0, the one-year forward exchange rate in the currency market is USD 0.0081 per one JPY. Assume your calculation for the forward rate is 120.0987.

If there is an arbitrage opportunity, then what should be the FI's arbitrage strategy at time t=0 (now)?