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Question 2 15 pts Inspired by your bank training program in NYC, you would like to see if triangular arbitrage works in the real world.
Question 2 15 pts Inspired by your bank training program in NYC, you would like to see if triangular arbitrage works in the real world. Assume you are working for a bank and have $1,000,000 to start. Here are Bank quotes: JP Morgan USD 1.2715/ 1GBP Citicorp EUR 1.111/ 1GBP Deutsche USD1.1644/ 1EUR A. Find the cross rate using JP Morgan and Citicorp and compare to Deutsche. B. Show whether Arbitrage exists using the Triangle Method. Find the profits at the end. The respective answers to A and B are: 0 USD 1.1444/EUR, $16,868. 0 USD 1.4128. $14285. USD 1.4128. $16.868 0 USD 1.1444/EUR, $14,285
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