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The US risk-free rate is 11% and the Mexico rate is 6%. The spot and 11-month forward exchange rates are 19.4 and 20.7 peso/$, respectively.
"The US risk-free rate is 11% and the Mexico rate is 6%. The spot and 11-month forward exchange rates are 19.4 and 20.7 peso/$, respectively. Find the covered interest arbitrage profit (expressed in $) you'll make in11 months if you can borrow either $1M or its equivalent in pesos?"
"111,771"
"93,143"
"98,309"
"99,009"
"96,477"
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