Question: Table #1 Amount $3,000,000 US Interest Rate 7% Mexico Interest Rate 4% Spot Rate Ps19.6512/$ 90-Day Forward Rate Ps19.2131/$ Investment for 90 days Part A)

Table #1
Amount	$3,000,000
US Interest Rate	7%
Mexico Interest Rate	4%
Spot Rate	Ps19.6512/$
90-Day Forward Rate	Ps19.2131/$
Investment for	90 days

Part A) Using data from Table #1, find the total proceeds (principal + interest income) of the investment for 90 days in the currency according to the rule of thumb (this is the amount that you will sell forward).

Part B) Using data from Table #1, find the total opportunity cost of capital (Hint: find proceeds of 90-day investment in a second currency: principal + interest income).

Part C) Using data from Table #1, find the CIA profit (after accounting for the opportunity cost of capital; do not round intermediate calculations; Round your final answer to the nearest US dollar).

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