Jack Ma, a foreign exchange trader in Canada, has CAD. 4,000,000 for short-term money market investment and wants to make a profit based on the following rates. Explain specific steps that Jack Ma must take to make a covered interest arbitrage.

CAD= Canadian Dollar

JYP= Japanese Yen

6-month Canadian interest rate	1.6% per annum
6-month Yen interest rate	2.95% per annum
Spot rate	JYP 93.1395/CAD
6-month forward rate	JYP 93.8380/CAD

Step 1

1) Different i for Base rate -Quote rate =

2) Different between Spot and Forward =

(1) + (2) =

invest in _ borrow in _

Step 2 explain using table

2 Second step spot