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Assume that as a result of covered interest arbitrage, the market forces caused the spot rate of the pound to rise to $ 1 .

Assume that as a result of covered interest arbitrage, the market forces caused the spot rate of the pound to rise to $1.62 and that the 90-day forward rate of the pound declined to $1.5888. Consider the results from using $800,000(as in the previous example) to engage in covered interest arbitrage.

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