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Help please, thanks! A currency dealer has good credit and can borrow either $1,000,000 or 800,000 for one year. The one-year inflation rate in the

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Help please, thanks!

A currency dealer has good credit and can borrow either $1,000,000 or 800,000 for one year. The one-year inflation rate in the U.S. is $=2.5% and in the euro zone the one-year inflation rate is =5.5%. The one-year forward exchange rate is $1.20=1.00; what must the spot rate be to eliminate arbitrage opportunities? $1.24711.00 $1.1547=1.00 $1.0200=1.00 $1.23511.00

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