Suppose you are a foreign currency trader and you are faced with the following quotations: US$ interest rate is 1% p.a UK interest rate is 2% p.a Exchange rate today is US$1.1706/ 6-month forward rate is $1.1615/ The assumptions are that there are no transaction costs and you can borrow US$1,000,000.00 only from the USA money market. Is there any opportunity for a riskless profit? What do you deduce from this transaction after making appropriate calculations? [25]