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Table below shown the spot and one-year forward rates of USD/GBP and USD/EUR. If interest rates are 4 percent in New York, 6 percent in
Table below shown the spot and one-year forward rates of USD/GBP and USD/EUR. If interest rates are 4 percent in New York, 6 percent in London, and 3 percent in Germany, explain where you can get the best return on a covered interest arbitrage for a one-year investment. (Assume: USD100,000 to be invested)
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