1.The ER is $/ real (BRL) .10, or rais 10 buy 1 US dollar. The change in...
Question:
1.The ER is $/ real (BRL) .10, or rais 10 buy 1 US dollar. The change in the ER is what percentage wise, if at the end of the year the ER is $/BRL .011111111, or BRL 90 buy 1 dollar? Show it in two ways;
a. The one is real per dollars and,
b. the other is dollars per real
2. The Venezuelan bolivar versus the US dollar is 7 to 1, i.e., 7 bolivars buy one dollar. The ER between the Swiss franc and the US dollar is one Swiss franc to 1.1 US $. Finally, the bolivar trades 7.02 per one Swiss franc.
a. What kind of triangular arbitrage will induce the highest profit for you?
b. Assume you start with $1 million, or the equivalent of it in the other currencies. (Note we are asking for the highest profit and not any profit.)
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill