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Assume that the following spot exchange rates exist today: 1 = $1.50; C$1 = $0.75 and 1 = C$1.7. Assume no transactions costs. a. Based

Assume that the following spot exchange rates exist today: 1 = $1.50; C$1 = $0.75 and 1 = C$1.7.

Assume no transactions costs. a. Based on these exchange rates, can triangular arbitrage be used to earn a profit? Explain.

b. Assuming you have $20,000. How much profit if any can you make?

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