Assume the Following Information for a Bank Quoting on Spot

question 97

Multiple Choice

Assume the following information for a bank quoting on spot exchange rates:
$$\begin{array} { l l r } \text { Exchange rate of Singapore dollar in U.S. } \$ & = & \$ .32 \\\text { Exchange rate of pound in U.S. } \$ & = & \$ 1.50 \\\text { Exchange rate of pound in Singapore dollars } & = & \text { S } \$ 4.50\end{array}$$
Based on the information given, as you and others perform triangular arbitrage, what should logically happen to the spot exchange rates?

• 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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Definitions:

DNA

A molecule that carries the genetic instructions used in the growth, development, functioning, and reproduction of all known living organisms and many viruses.

Chromosome

A thread-like structure of nucleic acids and protein found in the nucleus of most living cells, carrying genetic information in the form of genes.

Nucleus

The membrane-bound organelle in eukaryotic cells that contains genetic material (DNA).

Second Meiotic Division

The second phase of meiosis where sister chromatids are separated, resulting in the formation of four haploid daughter cells from the initial diploid cell.