Each of the following indicates a series of foreign exchange interventions by the monetary authority of a country. For each, do you think that the authority effectively made a profit or not?

a. The local currency is pesos. In January the authority intervenes to sell U.S. dollars at the rate \($3.00\)/peso. In June it intervenes to buy dollars at \($3.50\)/peso. In November it intervenes to sell dollars at \($3.10\)/peso. In June of the next year it intervenes to buy dollars at \($3.40\)/peso.

b. The local currency is the yen. In February the authority intervenes to sell yen at

\($0.60\)/yen. In October it intervenes to sell yen at \($0.55\)/yen. The next year it intervenes to sell yen in March at \($0.51\)/yen. In April the exchange rate stabilizes at

\($0.50\)/yen, and the authority ceases its intervention.