Suppose that the annual interest rate is 2.0 percent in the United States and 4 percent in Germany, that the spot exchange rate is $1.60/€ and that the forward exchange rate, with one-year maturity, is $1.50/€. Assume that an arbitrager can borrow up to $1,000,000 or €625,000. If an astute trader finds an arbitrage, what is the net cash flow in one year?

Suppose that the one-year interest rate is 5.0 percent in the United States. The spot exchange rate is $1.20/€, and the one-year forward exchange rate is $1.16/€. What must the one-year interest rate be in the euro zone to avoid arbitrage opportunities?Group of answer choices5.0%6.09%none of the options8.62%

Suppose you observe a spot exchange rate of $2.00/£. If interest rates are 5 percent per annum in the U.S. and 2 percent per annum in the U.K., what is the no-arbitrage one-year forward rate?Group of answer choices£1.9429/$$1.9429/££2.0588/$$2.0588/£

Suppose that the one-year interest rate is 3.0 percent in Italy. The spot exchange rate is $1.20/€, and the one-year forward exchange rate is $1.18/€. What must the one-year interest rate be in the United States to avoid arbitrage opportunities?Group of answer choices1.0128%1.2833%4.75%none of the options

You are an American investor who can borrow $1,000,000 or the equivalent amount in euros today.Suppose the spot rate is $1.20/€, and the one-year forward rate is $1.15/€. The annual interest rate is 5 percent in the U.S. and 3 percent in Germany. Check if IRP holds. If it does not hold, set up a covered interest arbitrage. What will be your profit from this arbitrage opportunity in dollars?

Assume the following information:​You have $1,000,000 to invest:Current spot rate of pound=$1.3090-day forward rate of pound=$1.283-month deposit rate in United States=3%3-month deposit rate in Great Britain=4%​If you use covered interest arbitrage for a 90-day investment, what will be the amount of U.S. dollars you will have after 90 days? $1,024,000 $1,030,000 $1,040,000 $1,034,000