Peder Mueller is a foreign exchange trader for a bank in New York. He has $1 million (or its Swiss franc equivalent) to invest for three months. He faces the rates given here: Spot exchange rate (CHF-USD1.00) 3-month forward rate (CHF-USD1.00) U.S. dollar 3-month interest rate Swiss franc 3-month interest rate 1.3392 1.3286 4.750% 3.625% How much profit can he make if he enter into a covered interest arbitrage? a. $746 b. $5,238 c. $2,982 d. $10,799 date ovi no munde 1918 1s 001% ano) loof Lasis DH 21

Peder Mueller is a foreign exchange trader for a bank in New York. He has \$1 million (or its Swiss franc equivalent) to invest for three months. He faces the rates given here: How much profit can he make if he enter into a covered interest arbitrage? a. $746 b. $5,238 c. $2,982 d. $10,799