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Suppose A wishes to borrow U.S. dollar and B wishes to borrow Swiss francs. In the lectures we show that if A borrows $924.18, A
Suppose A wishes to borrow U.S. dollar and B wishes to borrow Swiss francs. In the lectures we show that if A borrows $924.18, A will break even and all benefits go to B. If A borrows $959.58, B will break even and all benefits go to A. Between $924.18 and $ 959.58, both A and B benefit. Assume a spot exchange rate of 2 Swiss francs per U.S. dollar. Suppose A borrows $935
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