You are provided with the following sport exchange rates as they appear today in the foreign currency market desks of three local banks in Arushq

Kisongo Commercial Bank

Moshono Savings Bank

Sanawari Wakulima Bank

0.7650 - 0.7745/US$

TZS 1,395 - 1,420/US$

TZS 1,860 - 1,905/

Required:

(i) With supporting computations, show whether there exists arbitrage opport: ity (6 Marks)

(I) If there exists arbitrage opportunity, and assuming that you have TZS 10 million to invest show how you can exploit the oppuntonity and the amount of profit (in TZS) that you will make