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You live in Switzerland and want to try to make some money through interest rate arbitrage abroad. You notice the following rates quoted online:

 

You live in Switzerland and want to try to make some money through interest rate arbitrage abroad. You notice the following rates quoted online: Bid Ask Spot exchange rate CHF 1.1247/EUR CHF 1.1290/EUR 150-day Forward exchange rate CHF 1.1918/EURCHF 1.1972/EUR 150-day EUR interest rate 8.48% p.a. 8.74% p.a. 150-day CHF interest rate 11.56% p.a. 11.90% p.a. What will your profit (in CHF) be 150 days from now if you borrow CHF7 million and invest in France then convert back to the Swiss franc? a. CHF 303,379 O b. CHF 304,370 . CHF 362,074 O d. CHF 287,393 e. CHF 321,301 You live in Switzerland and want to try to make some money through interest rate arbitrage abroad. You notice the following rates quoted online: Bid Ask Spot exchange rate CHF 1.1247/EUR CHF 1.1290/EUR 150-day Forward exchange rate CHF 1.1918/EURCHF 1.1972/EUR 150-day EUR interest rate 8.48% p.a. 8.74% p.a. 150-day CHF interest rate 11.56% p.a. 11.90% p.a. What will your profit (in CHF) be 150 days from now if you borrow CHF7 million and invest in France then convert back to the Swiss franc? a. CHF 303,379 O b. CHF 304,370 . CHF 362,074 O d. CHF 287,393 e. CHF 321,301 You live in Switzerland and want to try to make some money through interest rate arbitrage abroad. You notice the following rates quoted online: Bid Ask Spot exchange rate CHF 1.1247/EUR CHF 1.1290/EUR 150-day Forward exchange rate CHF 1.1918/EURCHF 1.1972/EUR 150-day EUR interest rate 8.48% p.a. 8.74% p.a. 150-day CHF interest rate 11.56% p.a. 11.90% p.a. What will your profit (in CHF) be 150 days from now if you borrow CHF7 million and invest in France then convert back to the Swiss franc? a. CHF 303,379 O b. CHF 304,370 . CHF 362,074 O d. CHF 287,393 e. CHF 321,301 You live in Switzerland and want to try to make some money through interest rate arbitrage abroad. You notice the following rates quoted online: Bid Ask Spot exchange rate CHF 1.1247/EUR CHF 1.1290/EUR 150-day Forward exchange rate CHF 1.1918/EURCHF 1.1972/EUR 150-day EUR interest rate 8.48% p.a. 8.74% p.a. 150-day CHF interest rate 11.56% p.a. 11.90% p.a. What will your profit (in CHF) be 150 days from now if you borrow CHF7 million and invest in France then convert back to the Swiss franc? a. CHF 303,379 O b. CHF 304,370 . CHF 362,074 O d. CHF 287,393 e. CHF 321,301

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