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Assume the following information: Beal Bank. Yardley Bank. Bid price of New Zealand dollar $.402 $.398 Ask price of New Zealand dollar $.404 $.399 Given

Assume the following information:

Beal Bank. Yardley Bank.

Bid price of New Zealand dollar $.402 $.398

Ask price of New Zealand dollar $.404 $.399

Given this information, is locational arbitrage possible? if so, explain the steps involved in locational arbitrage, and compute the profit from this arbitrage if you had 1,000,000 to use. What market forces would occur to eliminate any further possibilities of locational arbitrage?

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