Suppose Ana can use 10 million EUR to make another arbitrage by using the following market rates. If she expects the exchange rate to stay very close to the spot rate, explain the possibility of arbitraging. (Please show your reasoning and proof). If yes, explain what kind of arbitrage can she perform this time? (5 marks)

Spot rate (RUB/): 86.81

90-day forward rate (RUB/): 86.50

Expected spot rate in 90 days (RUB/): 86.79

90-day EUR interest rate: 6.000%

90-day RUB interest rate: 4.600%

e) Show the detailed steps of the arbitrage strategy and calculate the arbitrage profit. Is this strategy risk free and why? (You may explain your answer with numerical examples) [15 marks]