Intro Suppose that the annual interest rate is 3 percent in the United States and 4 percent in Germany, and that the spot exchange rate is $1.17/ and the forward exchange rate with one-year maturity, is $1.09/. Assume that an arbitrager can borrow up to $1,000,000 or 854,701. Part 1 Attempt 1/5 for 10 pts. If an astute trader finds an arbitrage, what currency should he/she borrow to begin with? Neither will work Dollar Either will work Euro not enough information to tell if there is arbitrage Submit Part 2 - Attempt 1/10 for 10 pts. If an astute trader finds an arbitrage, what is the profit in one year (in the currency of Part 1)? 0+ decimals Submit