18. (CORRECTED) You observe the following quotes in the foreign exchange market. Investigate the presence of...
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18. (CORRECTED) You observe the following quotes in the foreign exchange market. Investigate the presence of an arbitrage opportunity. If there is one, detail the trades you would make and calculate your profit on a base of US$ 1,000,000. a. Scenario 1: USD/GBP quoted 1.600 - 1.610 USD/MYR quoted 0.200 0.202 MYR/GBP quoted 7.920 8.050 b. Scenario 2: USD/GBP quoted 1.600 - 1.610 USD/MYR quoted 0.200 0.202 MYR/GBP quoted 8.100 - 8.200 18. (CORRECTED) You observe the following quotes in the foreign exchange market. Investigate the presence of an arbitrage opportunity. If there is one, detail the trades you would make and calculate your profit on a base of US$ 1,000,000. a. Scenario 1: USD/GBP quoted 1.600 - 1.610 USD/MYR quoted 0.200 0.202 MYR/GBP quoted 7.920 8.050 b. Scenario 2: USD/GBP quoted 1.600 - 1.610 USD/MYR quoted 0.200 0.202 MYR/GBP quoted 8.100 - 8.200
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