The Spot Rate Between the UK and the U

question 12

Multiple Choice

The spot rate between the UK and the U.S.is £0.6789 = $1,while the one-year forward rate is £0.6782 = $1.The risk-free rate in the UK is 3.1 percent.The risk-free rate in the U.S.is 2.9 percent.How much profit can you earn on a loan of $2,000 by utilizing covered interest arbitrage?

• A)-$4.09
• B)-$2.78
• C)$3.15
• D)$6.13
• E)$8.55

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Infrastructure

The fundamental facilities and systems serving a country, city, or area, including transportation and communication systems, utilities, and public institutions, essential for the economy to function.

Public Works

Projects initiated by the government designed to build or improve public amenities such as roads, bridges, and schools.

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Services provided by the government or public sector to citizens, often funded through taxation, including healthcare, education, and transportation.

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