Bonus 3. How can we use arbitrage to make a risk less profit using rates in the above question (8.26)? a) borrow USD, convert at spot to JPY, invest in JPY and buy USD forward contracts b) borrow JPY, convertat spot to USD, invest in USD and sell USD forward contracts c) borrow and inve st in J PY d) borrow and invest in USD The following questions are bonus worth 2.5% each. Use the information available in Bonus Question 1 Please circle the best answer to each question Bonus 1. Ninety (90) day money market rates are 4% annualized in Japan and 1% annualized in US. Spot USD YEN is trading at 115 and the 90 day forward trades at 120. Are rates in line with Interest Rate Parity