You Are a U

question 50

Multiple Choice

You are a U.S.-based treasurer with $1,000,000 to invest. The dollar-euro exchange rate is quoted as $1.50 = €1.00 and the dollar-pound exchange rate is quoted at $2.00 = £1.00. If a bank quotes you a cross rate of £1.00 = €1.25 how can you make money?

• A)No arbitrage is possible.
• B)Buy euro at $1.50/€, buy £ at €1.25/£, sell £ at $2/£.
• C)Buy £ $2/£, buy € at €1.25/£, sell € at $1.50/€.

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Definitions:

Emotional Component

A part of emotions that involves the subjective, internal experience of feelings, distinct from physiological and behavioral components.

Interpersonal Communication

Communication between two or more people in an organization.

Interpersonal Communication Skill

The ability to effectively exchange information, feelings, and meaning between two or more people through verbal or non-verbal methods.

Department of Labor

A government department responsible for overseeing working conditions, wage standards, and employment laws to protect workers' rights.