Casper Landsten is a foreign exchange trader who has access to $1 million (or its Swiss Franc equivalent). Assume the spot exchange rate (SFr/$) is SFr1.278/$ and the 2-month forward rate is SFr1.275/$. Also assume that the US dollar 2-month interest rate (annualized) is 3.6% and that the Swiss franc 2-month interest rate (annualized ) is 2.4%.

In order to make a riskless profit, Casper should:

Group of answer choices

borrow dollars and invest in francs

it's impossible to make a profit here

borrow dollars and invest in dollars

borrow francs and invest in dollars

borrow francs and invest in francs