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The spot rate between the U.K. and the U.S. is .7579/$, while the one-year forward rate is .7533/$. The risk-free rate in the U.K. is
The spot rate between the U.K. and the U.S. is .7579/$, while the one-year forward rate is .7533/$. The risk-free rate in the U.K. is 4.45 percent and risk-free rate in the United States is 2.67 percent. How much in profit can you earn on $7,500 utilizing covered interest arbitrage?
$96.70
$181.34
$145.07
$158.67
$85.95
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