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The EUR / USD spot quote on the interbank market is 1 . 3 1 4 0 / 4 3 . Euroland interest rates are

The EUR/USD spot quote on the interbank market is 1.3140/43. Euroland interest rates are 2.065/2.135% and US interest rates are 1.424/1.598%. Using this information and round-trip transactions, calculate the range of bid-offer quotes that ensure no arbitrage opportunities exist over a 3-month (92-day) period. Explain how you arrived at your answer. (For calculation purposes, assume 360 days in the financial year).

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