Suppose you are a US-based investor and you observe the following: The spot rate S(S/E)=1.31 and the 6- month forward rate is F6(SE)-s1.32. The annualized nominal interest rate is 2% in the US. and 1% in the UK. Discuss whether covered interest arbitrage is possible. If it is possible, describe the steps you would take to conduct it and calculate the arbitrage profit if you can borrow S655,000 or 500,000