You have $24,000 and observe the following exchange rates:

Exchange rate	Bid	Ask
Value of euro in U.S. dollars	$1.2	$1.21
Value of Swiss franc in U.S. dollars	$1	$1.01
Value of euro in Swiss francs	CHF1.15	CHF1.16

Part 1

What is the no-arbitrage value of the euro in Swiss francs (the cross exchange rate)? Use the ask quotes. (reminder: Triangle starts with dollar as you only have dollar to begin with; assume you cannot borrow euro or franc, but can only exchange dollar into either euro or franc)

Part 2

Is there an arbitrage opportunity? If so, what should you do to exploit it?

Yes: buy Swiss francs with euros

No

Yes: buy euros with Swiss francs

Part 3

How many Swiss francs do you get from converting your dollars?

Part 4

How many euros do you get from converting your Swiss francs?

Part 5

How many dollars do you get from converting your euros?

Part 6

What is your profit from exploiting the opportunity once (in $)?