(Step 2 of CIA) Assume you have good credit and can borrow either $1,000,000 or 800,000 for one year. The one-year interest rate in the U.S. is is = 3% and in the euro zone the one-year interest rate is ie = 2%. The spot exchange rate is $1.25 = 1.00 and the one-year forward exchange rate is $1.24 = 1.00. If you determine that there is an arbitrage opportunity, to execute the coverage interest arbitrage you should and forward. o borrow in the United States; sell euro lend in the United States; buy euro lend in the euro zone; sell euro borrow in the euro zone; buy euro