Question: PART B. PROBLEM 4 You want to open a deposit account in the bank and searching the best options. While doing your research, you find

PART B. PROBLEM 4 You want to open a deposit account in the bank and searching the best options. While doing your research, you find out that Green Bank offers a 13% annual interest rate on all savings and loans while White Bank offers a 15% annual interest rate on all savings and loans. 1. Explain how arbitrage opportunity occurs (3 points) 2. Is arbitrage opportunity available in scenario above? Show profit you can get from exploiting this opportunity (5 points) 3. What bank will face increased demand for loans? What bank will face increased demands for deposits (savings)? (2 points)

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