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Cast Study: 5 Dr. Rashid Mubarak Alluri, was closely associated with Bank of Japan, Bank of Europe, State Bank of India and Bank Kuwait from

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Cast Study: 5 Dr. Rashid Mubarak Alluri, was closely associated with Bank of Japan, Bank of Europe, State Bank of India and Bank Kuwait from the period 22 December 2006 to 31" January 2015. Due to professional changes and higher designation, he started working in Al Jadood. Currency Exchange in Dubai, UAE from the year 16 February 2015 till 31 March 2020. Due to the impact of COVID 19, Dr. Rashid Mubarak Al Macari, decided to take advantage of the major currencies by playing a safer role with the interest rates of two multinational banks for reaping profit with an initial investment or USD 5 Million. In order to avoid any misleading decision from his side, Dr. Rashid Mubarak Al Murgi hired a Forex Management student from Nizwa College of Technology (HCT), Al Nizwa to provide valuable inputs pertaining to the period of investment and their details are given below. Option: 1 One Year interest rates in Japan is 7 per cent per annum and the United States is 9 per cent per annum. The Spot rate (S) and 360 Days Forward market rates (F.) is JPY 0.00934/USD and JPY 0.00947/USD, respectively. Option:2 One Year interest rates in Europe is 6 per cent per annum and the United States is 8 per cent per annum. The Spot rate (S.) and 360 Days Forward market rate (F) is USD 1.46/EUR and USD 1.4WEUR, respectively. Option: 3 One Year interest rates in India is 8 per cent per annum and the United States is 6% per cent per annum. The Spot rate (S.) and 360 Days Forward market rate (F) is INR 76.0123/USD and INR 76.8190/USD, respectively. Option: 4 One Year interest rates in Kuwait is 10 per cent per annum and the United States is 9 per cent per annum. The Spot rate (S.) and 360 Days Forward market rate (F) is KWD 0.311/USD and KWD 0.315/USD, respectively, By ignoring the transaction costs, you are required to provide the answer for the following question: a) Calculate the Covered Interest Rate Arbitrage opportunity prevailing in all the FOUR options? (8 - Marks) b) Which is the best possible option for Dr. Rashid Mubarak Al Slankoj to transfer the fund from JPY to USD, EUR to USD INR to USD and KWD to USD? (1 - Mark) c) What is the overall Profit or Loss for Dr. Rashid Mubarak Al Marroj in all the FOUR option? (1 - Mark)

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