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Suppose exchange rates are: EUR/AUD = 1.5550 GBP/AUD = 2.8923 GBP/EUR = 1.8600   Starting with 10,000 AUD, what are the one-round-trip arbitrage profits rounded to the nearest AUD?   14,180 AUD No arbitrage profit is possible. 1,961 AUD 73,654 AUD

Suppose exchange rates are: EUR/AUD = 1.5550 GBP/AUD = 2.8923 GBP/EUR = 1.8600   Starting with 10,000 AUD, what are the one-round-trip arbitrage profits rounded to the nearest AUD?   14,180 AUD No arbitrage profit is possible. 1,961 AUD 73,654 AUD

Essentials Of Investments
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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Suppose exchange rates are:

EUR/AUD = 1.5550

GBP/AUD = 2.8923

GBP/EUR = 1.8600

 

Starting with 10,000 AUD, what are the one-round-trip arbitrage profits rounded to the nearest AUD?

 

14,180 AUD

No arbitrage profit is possible.

1,961 AUD

73,654 AUD



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