Question: Part Il: Short Problems (12 points) points) Interest Rate Parity: It is expected from the forward rate quotations that the Swiss l appreciate over the

Part Il: Short Problems (12 points) points) Interest Rate Parity: It

Part Il: Short Problems (12 points) points) Interest Rate Parity: It is expected from the forward rate quotations that the Swiss l appreciate over the next 12 months, All appropriate quotes are given below: s0.8200 -$0.8300/SF Spot rate: 12 month Forward rater $0.8370 S0.8460/ SF U.S. interest rate: Swiss interest rate: 3.0%-3.4% annualized 2.4%-2.8% annualized access to a line of credit of SF I million, based on Interest Rate Parity, can you make a by borrowing money in Switzerland based on quotes above? Show all calculations. arbitrage profit What will be your profit or loss from this investment strategy

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