Consider the following:

RFR in USA = 0.04

RFR in AUS = 0.03

spot exchange rate= 1.67

market price is 1.63 A$/$, how could you arbitrage? (Hint: express the exchange rates in terms of US dollar, as they are expressed in terms of AUD)

	A.	Borrow Australian dollars in Australia, convert them to dollars, lend the proceeds in the United States, and enter futures positions to purchase Australian dollars at the current futures price.
	B.	Borrow U.S. dollars in the United States, convert them to Australian dollars, lend the proceeds in Australia, and enter futures positions to sell Australian dollars at the current futures price.
	C.	Borrow U.S. dollars in the United States, invest them in the U.S., and enter futures positions to purchase Australian dollars at the current futures price.
	D.	There is no arbitrage opportunity.