Question: Assume that the three month FR = $2.00/1 and a speculator believes that the spot rate in three months will be SR = $2.05/1. How

Assume that the three month FR = $2.00/£1 and a speculator believes that the spot rate in three months will be SR = $2.05/£1. How can a person speculate in the forward market? How much will the speculator earn if he or she is correct?

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