Assume the Following Information for a Bank Quoting on Spot

question 88

Multiple Choice

Assume the following information for a bank quoting on spot exchange rates:​ Based on the information given, as you and others perform triangular arbitrage, what should logically happen to the spot exchange rates?
Exchange rate of Singapore dollar in U.S $=$.60
Exchange rate of pound in U.S.$=$1.50
Exchange rate of pound in Singapore dollars=S$2.6

• A)The Singapore dollar value in U.S. dollars should appreciate, the pound value in U.S. dollars should appreciate, and the pound value in Singapore dollars should depreciate
• B)The Singapore dollar value in U.S. dollars should depreciate, the pound value in U.S. dollars should appreciate, and the pound value in Singapore dollars should depreciate
• C)The Singapore dollar value in U.S. dollars should depreciate, the pound value in U.S. dollars should appreciate, and the pound value in Singapore dollars should appreciate
• D)The Singapore dollar value in U.S. dollars should appreciate, the pound value in U.S. dollars should depreciate, and the pound value in Singapore dollars should appreciate

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