Question

Assume the following bid and ask rates of the pound for two banks as shown below:...

Assume the following bid and ask rates of the pound for two banks as shown below:

Bid Ask
Sampath Bank in Sri Lanka Rs. 120.15 Rs. 121.42
ANZ in Australia Rs. 121.58 Rs. 121.82

What is the arbitrage profit per Australian dollar?

A.

Rs. 0.16.
B.

Rs. 0.24.
C.

Rs. 1.27.
D.

Rs. 1.43.
E.

There is no arbitrage opportunity.
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