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The spot rate between the U.K. and the U.S. is .7594/$, while the one-year forward rate is .7536/$. The risk-free rate in the U.K. is
The spot rate between the U.K. and the U.S. is .7594/$, while the one-year forward rate is .7536/$. The risk-free rate in the U.K. is 4.51 percent and risk-free rate in the United States is 2.70 percent. How much in profit can you earn on $9,000 utilizing covered interest arbitrage?
a.) $235.29
b.) $205.88
c.) $102.44
d.)$91.06
e.) $188.23
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