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b. Spritzer Company operates in England and believes the value of the dollar is overvalued and likely to fall. The dollar is currently valued at
b. Spritzer Company operates in England and believes the value of the dollar is overvalued and likely to fall. The dollar is currently valued at 90 Euros and Spritzer believes the dollar will fall 10% against the Euro in the next six months. They intend to short the dollar by borrowing from a New York bank and immediately converting the dollars to Euros at the current exchange rate. They will invest the Euros in their London bank and convert back to dollars at the end of the six months. They will also have to repay the loan to the New York Bank Detail the steps in the process and indicate whether Spritzer will profit from their speculation. (show work)
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