Consider the Following: If the Futures Market Price Is

question 30

Multiple Choice

Consider the following: If the futures market price is 1.63 A$/$, how could you arbitrage

• A)Borrow Australian dollars in Australia, convert them to dollars, lend the proceeds in the United States, and enter futures positions to purchase Australian dollars at the current futures price.
• B)Borrow U.S.dollars in the United States, convert them to Australian dollars, lend the proceeds in Australia, and enter futures positions to sell Australian dollars at the current futures price.
• C)Borrow U.S.dollars in the United States and invest them in the U.S.and enter futures positions to purchase Australian dollars at the current futures price.
• D)Borrow Australian dollars in Australia and invest them there, then convert back to U.S.dollars at the spot price.
• E)There is no arbitrage opportunity.

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Definitions:

Ventral Stream

The pathway in the brain that processes visual information related to object recognition and form representation.

Dorsal Stream

The pathway in the brain that processes spatial awareness and the relationships between objects, often referred to as the "where" or "how" pathway.

Brain Damage

Injury to the brain that can result in impairments or disabilities in cognitive function, physical abilities, or emotional behavior.

Oval Window

A membrane-covered opening that leads from the middle ear to the cochlea of the inner ear, transmitting sound vibrations.