Question

37--Given the following exchange rates, what arbitrage profit is available if you have $1 million? ¥129.87/$, €1.1226/$, ¥115.74/€

Select one:

a. $460

b. -$460

c. $878

d. $259,652

Answer #1

HI,

you have $1,000,000 initially

so at first from this $1,000,000 you will buy Euro

1 dollar = 1.1226 Euro

$1,000,000 = 1.1226*1000000 = $1,122,600 Euro

Now from this Euro amount you will buy Yen

1 Euro =115.74 Yen

1,122,600 Euro = 1122600*115.74 = 129,929,724 Yen

From Yen we will buy dollar again

1 Yen = 1/129.87 dollar

129,929,724 Yen = 129929724/129.87 = $1,000,459.88

**So arbitrage price = 1,000,459.88 -1,000,000 = $459.88
~$460**

**Hence option a is correct here.**

**Thanks**

21-)
Given the following exchange rates, what arbitrage profit is
available if you have $1 million? ¥129.87/$, €1.1226/$,
¥115.74/€
Select one:
a. $259,652
b. $460
c. -$460
d. $878
30-)
The current U.S. dollar-yen spot rate is 125¥/$. If the 90-day
forward exchange rate is 127 ¥/$ then the yen is selling at a per
annum forward ________ of ________.
Select one:
a. premium; 1.57%
b. discount; 6.30%
c. premium; 6.30%
d. discount; 1.57%
33-)
Sarah bought a 3-month British...

3-)
Changes in the BOP may predict the imposition or removal of
foreign exchange controls.
Select one:
True
False
37-)
Given the following exchange rates, what arbitrage profit is
available if you have $1 million? ¥129.87/$, €1.1226/$,
¥115.74/€
Select one:
a. $460
b. -$460
c. $878
d. $259,652
38-)
Assume an international regime of fixed exchange rates. When
countries do not want to engage in direct intervention, countries
with a BOP ________ should consider ________ their currency while
countries with...

35-) You have been hired as a consultant to the central bank for
a country that has for many years suffered from repeated currency
crises and depends heavily on the U.S. financial and product
markets. Which of the following policies would have the greatest
effectiveness for reducing currency volatility of the client
country with the United States?
Select one:
a. an internationally floating exchange rate
b. an exchange rate pegged to the U.S. dollar
c. an exchange rate with a...

Swissie Triangular Arbitrage. The following
exchange rates are available to you. (You can buy or sell at the
stated rates.) Assume you have an initial SF 13,000,000. Can you
make a profit via triangular arbitrage? If so, show the steps and
calculate the amount of profit in Swiss francs (Swissies).
Mt Fuji Bank
90.34 Euro/$
Mt. Rushmore Bank
SF 1.02/$
Mt. Blanc Bank
91.97 Euro/SF
Calculate First arbitrage opportunity attempt below:
(Round to the nearest cent)
Attempt number 1: Start...

The following exchange rates are available to you. (You can buy
or sell at the stated rates.)
SGD/USD
1.65
USD/CHY
0.16
SGD/CHY
0.30
Assume you have an initial USD 12,000. Can you make a
profit via triangular arbitrage? If so, show the steps
and calculate the amount of profit in USD.

The following Spot exchange rates are available: ¥64.00/SF,
SF1.60/$ and, ¥105.00/$. You have $100,000 available. Can you make
money by triangular arbitrage, and if so, how much?
please show and explain all work!

Suppose you are given the following exchange rates:
0.0094/0.0098 $/¥
60.7492/60.7512 ¥/CHF
0.5837/0.5841 $/CHF
Find the triangular arbitrage profit and describe the steps
involved if you can start with 1 million CHF

Suppose you are given the following exchange rates:
0.0094/0.0098 $/¥
60.7492/60.7512 ¥/CHF
0.5837/0.5841 $/CHF
Is there a triangular arbitrage opportunity? Describe the steps
involved if you can start with 1 million CHF.

SHOW ALL WORK PLEASE
4. Triangular Arbitrage
Riskless profit using 10,000,000 Swiss franc. The following
exchange rates are available to you. (You can buy or sell at the
stated rates.)
Mt. Fuji Bank
Mt. Rushmore Bank
Mt. Blanc Bank
¥120.00/$ SF 1.6000/$ ¥80.00/SF

Triangular Arbitrage:
Ignore the bid ask spread and suppose
that you are given the following currency quotes for three markets
(C$ is the symbol for the Canadian $).
- Toronto: S($/C$
)= $0.80
Hamburg: S($/€ ) = $1.28
Vancouver: S(€/C$) = €0.58
a. Use the exchange rates from Toronto
and Hamburg to calculate the
implied euro
price of the Canadian $.
An arbitrage opportunity does exist. Suppose you start
with
$1,000,000. Show exactly how much
profit you would make...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 2 minutes ago

asked 34 minutes ago

asked 36 minutes ago

asked 47 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 2 hours ago

asked 2 hours ago