Copenhagen Covered $($B$).$ Heidi H$$i Jensen, a foreign exchange trader at J$.$P$.$ Morgan Chase, can invest $$5$ million, or the

foreign currency equivalent of the bank's short term funds, in a covered interest arbitrage with Denmark. She is now evaluating

the arbitrage profit potential in the same market after interest rates change: $.($Note that anytime the difference in interest rates

does not exactly equal the forward premium, it must be possible to make CIA profit one way or another.$)$

The CIA profit potential is

$\%,$ which tells Heidi that she should borrow

and invest in the

interest

rate currency,

$],$ gaining on the re$-$exchange of dollars for krone at the end of the period. $($Round to three decimal

places and select from the drop$-$down menus.$)$

The CIA profit amount is kr $.($Round to two decimal places.$)$

Data table

$($Click on the following icon $$ in order to copy its contents into a spreadsheet.$)$