When a dealers spot quote for Canadian dollar is $0.6240-45,

you pay $0.6240 if you are buying Canadian dollars

you collect $0.6245 if you are selling Canadian dollars

you pay $0.6245, if you are buying Canadian dollars

you collect $0.62425 if you are selling Canadian dollars,

Answer questions # 11 to 13 with the following quoted rates:

$/ = 1.3120; C$/$ = 1.0250; C$/ = 1.3490

11. The implied cross rate for (C$/) is C$1.3448.

a) True b) False

12. Do the above rates offer triangular arbitrage opportunity?

a) Yes b) No

13. Arbitrage strategy involves

a. Buying euro in the cross market and selling it in the direct market

b. Buying euro in the direct market and selling it in the cross market

c. Buying C$ in the direct market and selling it in the cross market.

d. Doing nothing.