Question

Consider the three banks that provided the following quotations for the U.S. dollar, Japanese yen and...

Consider the three banks that provided the following quotations for the U.S. dollar, Japanese yen and Russian ruble:

                                                                                                             Quoted Mid Price

Citibankà    Value of a Japanese yen in U.S. dollars  (¥/$)                         $0.0085           

JP Morgan à    Value of a Russian ruble in U.S. dollars  (RUB/$)              $0.0226  

Mizuho Bank àValue of a Russian ruble in Japanese yen (RUB/¥)           ¥2.69

                 

Determine whether the cross exchange rate between the Russian ruble and Japanese yen is appropriate or whether there is a triangular arbitrage opportunity.

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