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Given the information: Interest rate in US (Rh): 7% Interest rate in Canada (Rh): 5% Line of credit in US USD 10,000,000 Line of credit

Given the information:

Interest rate in US (Rh): 7% Interest rate in Canada (Rh): 5% Line of credit in US USD 10,000,000 Line of credit in Canada CAD 12,500,000 The spot rate for CAD (S0): $0.80 1-year forward rate for CAD (FR): $0.812

If you wanted to set up a covered interest rate arbitrage, you should borrow in and invest in _______ Group of answer choices

USD; CAD

CAD; USD

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