1. You have $46,000 and observe the following exchange rates:

   Exchange rate	Bid	Ask
   Value of euro in U.S. dollars	$1.13	$1.14
   Value of Swiss franc in U.S. dollars	$1	$1.01
   Value of euro in Swiss francs	CHF1.08	CHF1.09

   1. What is the no-arbitrage value of the euro in Swiss francs (the cross exchange rate)? Use the ask quotes.

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

      No

      Yes: buy Swiss francs with euros

      Yes: buy euros with Swiss francs

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

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

   5. How many dollars do you get from converting your euros?

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