Assume the following bid and ask rates of the pound GBP / US$ for two banks as shown below:

Bid Ask

Bank A $1.41 $1.42

Bank B $1.39 $1.40

As arbitrage occurs:

A) the bid rate for GBP at Bank A will increase; the ask rate for GBP at Bank B will increase

B) the bid rate for GBP at Bank A will increase; the ask rate for GBP at Bank B will decrease

C) the bid rate for GBP at Bank A will decrease; the ask rate for GBP at Bank B will decrease

D) the bid rate for GBP at Bank A will decrease; the ask rate for GBP at Bank B will increase.