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The quotes for $, and from three different financial institutions are as follows: Assume you have US $1 million to invest. CIBC$0.6500/ RBC 0.8130/$ TD
The quotes for $, and from three different financial institutions are as follows: Assume you have US $1 million to invest. CIBC$0.6500/ RBC 0.8130/$ TD 1.9300/ (1) What is the implied cross rate? (2) Is there an arbitrage opportunity? Why? (3) If there is an arbitrage opportunity, calculate the arbitrage profit and show your calculation steps. (4) Can this opportunity be sustained over a long term? Why or Why not
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Finance And Sustainability
Authors: Karolina Daszyńska-Żygadło, Agnieszka Bem, Bożena Ryszawska, Erika Jáki, Taťána Hajdíková
1st Edition
3030344037, 978-3030344030
