) Assume the following information: $.645 $.652 3.1 % Current spot rate of New Zealand dollar One-year forward rate of the New Zealand dollar Annual interest rate on New Zealand dollars 3.6% Annual interest rate on U.S. dollars Given the information in this question, the additional profit from covered interest arbitrage by U.S investors with $100,000 to invest is equal to a) Would Covered interest Arbitrage work for a New Zealand investor with 100,000 NZD to invest? b) 10) Assume the following information: - $0.055 Current spot rate of MXP = $0.052 One-year forward rate of the MXP 8% Annual interest rate on MXP Annual interest rate on U.S. dollars 5% a) Given the information in this question, the additional profit from covered interest arbitrage by a Mexican Investor with 100,000 MXP to invest. Pesos Would covered interest arbitrage work for a US investor with $100,000 to invest? b) hapter 9 Net Inflows and Outflows measured in US dollars Transaction exposure based on VAR 11) Magent Co. is a U.S. company that has exposure to Euros and Pounds. It has net inflows of 20 million Euros and net outflows of 15 million pounds next month. The present exchange rate of the Euro is $1.22/1 Euro while the present exchange rate of the Pound is $1.31/1GBP. Magent Co. has not hedged these positions. a) What is the net inflow or outflow for Magent Company as measured in US dollars? b) The Euro and Pound are highly correlated in their movements against the dollar. If the S dollar weakens (both foreign currency strengthens), will Magent Co. benefit from he exchange rate movement or be adversely affected by the exchange rate movement? fearts from a German company for 2.0 million