Suppose that the treasurer of IFM (a US company) has an extra cash reserve of $100,000,000 to invest for six months. The interest rate is 8 percent per annum in the United States and 7 percent per annum in Germany. Currently, the spot exchange rate is 1.01 per dollar and the six-month forward exchange rate is 0.99 per dollar. The treasurer of IFM does not wish to bear any exchange risk.

State clearly where he/she should invest to maximize the return.