QUESTION 7 Assume you are a French investor. You see that stock for British Airways has a bid price of EUR 36 and an ask price of EUR 36.5 on the French exchange, a bid price of GBP30 and an ask price of GBP30.1 in Great Britain and that the EUR/GBP bid-ask rates are 1.20 -1.25. How much would you gain or lose by buying the stock in France and selling it in Great Britain? Again of EUR1 e A loss of EURO.5 e Again of EUR 43.2 None of the answers is correct. QUESTION 8 Blake Inc. US, MNC needs to pay EUR1,000,000 in one year. It can earn 2 percent annualized on a German security. The current spot rate for the euro is USD1.00 per euro. Blake can borrow funds in the U.S. at an annualized interest rate of percent. If Blake uses a money market hedge to hedge the payable, what is the cost of implementing the hedge (rounded to the nearest dollar)? $980,392 None of the answers is correct. $1,000,000 $19,608