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The 60-day period lending rate for the Mexican Peso (MXN) is 0.80 percent and the 60-day period borrowing rate for the Australian dollars (A$) is
The 60-day period lending rate for the Mexican Peso (MXN) is 0.80 percent and the 60-day period borrowing rate for the Australian dollars (A$) is 1.05 percent. Delta bank expects the exchange rate of the MXN to appreciate from its current level of A$0.063 to A$0.070 in 60 days. Assume that Delta can borrow A$ 1,000,000. If the MXN appreciates to A$0.07 in 60 days as expected, what is Delta's profit in Australian dollars? OA. A$ 1,578,096 B. A$ 114,778 O C. - A$ 2500 D. A$ 110,467 E. A$ 109,500
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