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The respective nominal interest rates for Malaysia and Singapore are 5% per annum and 7 % per annum respectively. The spot rate is RM3.15/SGD and

The respective nominal interest rates for Malaysia and Singapore are 5% per annum and 7 % per annum respectively. The spot rate is RM3.15/SGD and the one year forward rate is RM3.13/SGD. Using RM300,000, calculate the profit derived from a covered interest arbitrage.

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