Question: Triangular arbitrage.Great Exchanges, Inc. is a currency exchange company located at most international airports. Today, a clerk has made a mistake on one of the

Triangular arbitrage.Great Exchanges, Inc. is a currency exchange company located at most international airports. Today, a clerk has made a mistake on one of the currency exchanges and has posted the following rates:

$ for

for

for $

for $

for

$ for

0.5325

1.4815

1.3337

1.8779

1.0150

0.7498

Which corresponding rates do not match? If you have

$100,

how much would you make on one pass through the currencies if you went the wrong way for the arbitrage?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!