- On checking the Telerate screen, you see the following exchange rate and interest rate quotes being made by a large bank: - U.S. Dollar 90-Day Interest Rates (Annualized) 4.99%5.03% - Swiss franc 90-Day Interest Rates (Annualized) 3.14%3.19% (NB: The above interest-rates are annualized interest-rates appropriate for a period of 90 days which you assume is exactly 0.25 years). - Spot Rates \$0.711-22 - 90-Day Forward Rates \$0.726-32 (NB: The spot and forward rates are expressed as the number of USD (\$) per SFR. The big figure is understood so this means spot is 0.71000.7220 and forward is 0.72600.7320) ). - a. Suppose you worked for a hedge fund trying to make arbitrage profits. Can you find an arbitrage opportunity? - b. What steps must you take to capitalize on it? - c. What is the profit per $1 million arbitraged (i.e., 1 mio USD is the risk capital)