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Your favorite bank trader calls you and tells you that she can execute the trades at the following quoted bid-ask spot prices: Bank A: Korean

Your favorite bank trader calls you and tells you that she can execute the trades at the following quoted bid-ask spot prices:

Bank A: Korean won 100 - 110 per Singapore $, Bank B: Hong Kong $3.50 3.60 per Singapore $ and Bank C: Korean won 30 - 32 per Hong Kong $, If you have access to a line of credit of Hong Kong $100,000 mil, based on cross-exchange rates and triangular arbitrage, what is the arbitrage gain or loss if you go from Hong Kong $ to Korean won to Singapore $ and back to Hong Kong, based on these quotes (rounded)?

a.

Loss HK$ 1818

b.

Loss HK$ 4545

c.

Loss HK$ 5000

d.

Gain HK$ 4545

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