Here are some quotes of the Burundi Franc/U.S. Dollar spot exchange rate given at once via internet by four banks: Bank Yellow: Bank Purple: Bank Blue: Bank Pink: 1,945.8871-1947 2134 1,945.8921-1947.5021 1,947.3112-1948.9978 1,947.1981-1948.8697 Are these quotes logical? Do you see an arbitrage opportunity? (6 points) Homework 2 (related with the 8th Week, 37th Reading Material): The Hong Kong dollar is quoted as HKD/US$=7.7438-7.7582 and the Colombian peso is quoted as COP/US$=3,481.0191-3,485.9599. What is the implicit quotation (bid and ask prices) of COP/HKD? (10 points) Homework 3 (related with the 3rd Week, 3rd and 5th Reading Material): Suppose that the annual interest rates on 6-months borrowing in Romania and the United States are 12.7 % and 0.8 %, respectively. The current spot rate RON/USS is 4.00 and 6-months forvard rate RON/USS is 4.21 (16 points) a) Does interest rate parity hold? b) Can arbitrage profits be made? If yes, assuming that Romania is your home country would you borrow 1000.000 RON in Romania or 1.000.000 US$ in the United States Calculate you arbitrage profit c) Would it be as a result of covered or uncovered interest arbitrage, why? d) Determine arbitrage potential in b) using statattet uix months of RONUS 5 4.25 rather than 6 montisfoniard rare (1) What is balance of payments? How could (2) the acquisition of a Moldovan soft drinks company by a US company for 5 million dollars in 2018 and (3) annual profits from the US investment in Moldova at 145.000 $ in 2019 be recorded in the balance payments in Moldova and the USA in 2018 and 2019. (8 points)