oday's foreign quotation. Below are the following quotes: - 100 JPY/USD 1.60 USD/GBP 140 JPY/GBP Assume the initial investment is $1,000,000 determine the profit in dolla sketch of triangular arbitrage. b) Calculate the cross rate by using the information in four decimals (i) AUD/NZD 0.5200 USD/AUD 0.4850 USD/NZD

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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(a) Mr James is foreign exchange trader is checking on his computer screen on
today's foreign quotation. Below are the following quotes: -
100 JPY/USD
1.60 USD/GBP
140 JPY/GBP
Assume the initial investment is $1,000,000 determine the profit in dollar term with a
sketch of triangular arbitrage.
(b) Calculate the cross rate by using the information in four decimals below:
(i) AUD/NZD
0.5200 USD/AUD
0.4850 USD/NZD
JPY70.43/AUD
GBP0.3891/AUD
(ii) JPY/GBP
Transcribed Image Text:(a) Mr James is foreign exchange trader is checking on his computer screen on today's foreign quotation. Below are the following quotes: - 100 JPY/USD 1.60 USD/GBP 140 JPY/GBP Assume the initial investment is $1,000,000 determine the profit in dollar term with a sketch of triangular arbitrage. (b) Calculate the cross rate by using the information in four decimals below: (i) AUD/NZD 0.5200 USD/AUD 0.4850 USD/NZD JPY70.43/AUD GBP0.3891/AUD (ii) JPY/GBP
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