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Suppose that the USD is pegged to gold at $10 per ounce and the euro is pegged to gold at 8 per ounce. If the

Suppose that the USD is pegged to gold at $10 per ounce and the euro is pegged to gold at 8 per ounce. If the current market exchange rate is $1.20 per euro, is there any arbitrage opportunity? If yes, how much can you make? Assume that you have $1,000 available for the investment. $41.67. $102. $40. $108. $125. There is no arbitrage opportunity since the US and EU are pegged to gold. $104.17. 120. $120

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