(IRP Arbitrage 15 Points - Answewr ALL Parts A, B, C) Spot exchange rate 360-day forward rate S(GBP/EUR) F360 (GBP/EUR) 1.15 = 1.20 33 U.K. interest rate EU interest rate 'UK 'EU 10.0% 5.0% A) What is the theoretical Forward rate that should prevail in this market under IRP? B) As a UK investor how would you exploit the arbitrage opportunity? YOU MUST: Outline all steps necessary and determine the GBP profit that an investor could net on a 10,000 GBP basis-NOTE =0 days OR in the future, time 360 days (your choice). C)What factors (list at least 2) keep arbitrage opportunities like this from occurring in practice?