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Suppose we observe the following quotes: FR/USD Bid 1.5971 AUD/USD 1.8215 AUD/FR 1.1450 Do we have an arbitrage opportunity? [2 MARKS] If so, how

Suppose we observe the following quotes: FR/USD Bid 1.5971 AUD/USD 1.8215 AUD/FR 1.1450 Do we have an arbitrage opportunity? [2 MARKS] If so, how much do we earn with USD1 million available to trade? [8 MARKS] Suppose we start with the AUD/FR cross rate Ask 1.5979 1.8220 1.1458

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