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S pot an arbitrage opportunity ( if it exists ) in the following situation. Suppose that a dealer A offers to buy british pounds in
S pot an arbitrage opportunity if it exists in the following situation. Suppose that a dealer A offers to buy british pounds in an year from now at a rate of Rs while dealer B would sell British pounds immediately at a rate of Rs a pound. Assume that a rupee can be borrowed at an annual rate of and a British pound can be invested in a bank at annual interest.
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