Question: Given the information: 4% 6% $0.80 Interest rate in US (Rh): Interest rate in Switzerland (RF: The current spot rate for CHF (SR): 1-year forward

Given the information: 4% 6% $0.80 Interest rate in US (Rh):

Given the information: 4% 6% $0.80 Interest rate in US (Rh): Interest rate in Switzerland (RF: The current spot rate for CHF (SR): 1-year forward rate for CHF (FR): Line of credit in US Line of credit in Switzerland $0.78 USD 10,000,000 CHF 12.500.000 If you set up a covered interest rate arbitrage, your covered interest arbitrage profit will be: - CHF 200,000 -USD 250,000 USD 65.000 CHF 83.333

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