Question
Today the spot rate between Canada and the U.S. is Can$1.2431/$, while the one-year forward rate is Can$1.2430/$. The risk-free rate in Canada is 4.53
Today the spot rate between Canada and the U.S. is Can$1.2431/$, while the one-year forward rate is Can$1.2430/$. The risk-free rate in Canada is 4.53 percent and risk-free rate in the United States is 2.71 percent. How much in profit can you earn on $9,500 utilizing covered interest arbitrage?
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$151.99
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$138.96
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$172.10
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$173.70
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$193.61
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Public Finance
Authors: Harvey S. Rosen
5th Edition
025617329X, 978-0256173291
