BONUS QUESTION: If you don't answer to this question, your score will NOT be affected negatively, Suppose you are a speculator working in a hedgefund that specializes in the foreign exchange market. The USDMXN is currently trading at 21.51 and the economist at the hedgefund forecast the exchange rate will be at 22.15 in one year. Suppose the anual nominal interest rate for deposits in USD is 1% with a monthly capitalization while the annual nominal interest rate for deposits in MXN is 4% also with a monthly capitalization. You are thinking shorting 20,000,000 MXN and investing the proceeds in USD. Hint: Since your are a speculator you would have to pay the funding in MXN since you don't have a prior position in MXN. If the forecast of your economists is correct, would it make economic sense to make this trade? No, I would stand to lose 1197, 595.08 MXN Yes, I would stand to make 1.197.595.08 MXN No, I would stand to lose 12.861.51 MXN Yes, I would stand to make 12 861.51 MXN I would be indifferent because my return on the exchange rate with be compensated by my funding costs