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DePaul International Bank is a U.S. bank that wants to speculate on the dollareuro exchange rate. A euro () costs $1.2 today. The bank expects
DePaul International Bank is a U.S. bank that wants to speculate on the dollareuro exchange rate. A euro () costs $1.2 today. The bank expects it to cost $1.28 in 8 months. Current annual interest rates are as follows: The bank doesn't want to use any of its own money, but could borrow either $10,000,000 or 10,000,000. Assume there are 30 days in every month and 360 days per year. Ignore compounding when working with the interest rates. Attempt 3/10 for 10 pts. What is the expected profit from the trade after 8 months (in $ )
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