Suppose you observe the following direct spot quotations in New York and Toronto, respectively: 0.8000-50 and 1.2500-60. What are the arbitrage profits per $1 million?

Assuming no transaction costs, suppose £1 = $2.4110 in New York, $1 = FF 3.997 in Paris, and FF 1 = £0.1088 in London. How could you take profitable advantage of these rates?

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Lets break down the first part of your question regarding arbitrage profits 1 New York Spot Quotatio... View the full answer