Takeshi Kamada, a foreign exchange trader at Credit Suisse (Tokyo), is exploring covered interest arbitrage possibilities. He wants to invest $5,000,000 or its yen equivalent, in a covered interest arbitrage between U.S. dollars and Japanese yen. He faced the following exchange rate and interest rate quotes.

Assumptions		Value				Yen Equivalent
Arbitrage funds available		$5,000,000				593,000,000
Spot rate (/$)				118.60
180-day forward rate (/$)		117.80
180-day U.S. dollar interest rate		4.800%
180-day Japanese yen interest rate		3.400%

1) The difference between interest rate ( i$- i/) is% (in 2 decimals).

2) The forward premium on the yen is% (in 2 decimals).

3) It seems there is a covered interest arbitrage opportunity, the arbitrage profit is .