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You have the following spot bid and ask rates between the Australian dollar (AUD), the Danish krone (DKK), and the Japanese yen (JPY): Bid Ask JPY 14.804/DKK JPY 14.952/DKK JPY 72.229/AUD JPY 72.955/AUD DKK 4.5722/AUD DKK 4.6182/AUD Which of the following is the closest to the arbitrage profit that is possible at these rates? O a. 4.11% O b. 3.70% O c. 4.60% d. 4.44% O e. 4.85%

You have the following spot bid and ask rates between the Australian dollar (AUD), the Danish krone (DKK), and the Japanese yen (JPY): Bid Ask JPY 14.804/DKK JPY 14.952/DKK JPY 72.229/AUD JPY 72.955/AUD DKK 4.5722/AUD DKK 4.6182/AUD Which of the following is the closest to the arbitrage profit that is possible at these rates? O a. 4.11% O b. 3.70% O c. 4.60% d. 4.44% O e. 4.85%

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
Problem 1PS
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You have the following spot bid and ask rates between the Australian dollar (AUD), the Danish krone (DKK), and the Japanese yen (JPY): Bid Ask JPY 14.804/DKK JPY 14.952/DKK JPY 72.229/AUD JPY 72.955/AUD DKK 4.5722/AUD DKK 4.6182/AUD Which of the following is the closest to the arbitrage profit that is possible at these rates? a. 4.11% b. 3.70% c. 4.60% d. 4.44% е. 4.85%
Transcribed Image Text:You have the following spot bid and ask rates between the Australian dollar (AUD), the Danish krone (DKK), and the Japanese yen (JPY): Bid Ask JPY 14.804/DKK JPY 14.952/DKK JPY 72.229/AUD JPY 72.955/AUD DKK 4.5722/AUD DKK 4.6182/AUD Which of the following is the closest to the arbitrage profit that is possible at these rates? a. 4.11% b. 3.70% c. 4.60% d. 4.44% е. 4.85%
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