Question: You can borrow 1000000 usd and the following data are at your disposal: 1year us interest rate 3%. 1year eurozone interest rate 4%. Usd/eur. spot

You can borrow 1000000 usd and the following data are at your disposal: 


1year us interest rate  3%.      


1year eurozone interest rate 4%.           


 Usd/eur. spot rate. 1.22 eur per usd.                         


 Usd/eur forward rate. 1.21eur per usd.                                                                                                                                    .                           


Explain how an arbitrager can take to profit the discrepancy in rates based on $1.000.000

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