Calculate the arbitrage opportunity


Question: The following is the current market value of 4 investments & their cash flow.  Determine the arbitrage opportunity and how much would you make on the arbitrage?

Investment

Current Price

Cash Flows

 

 

Year 1

Year 2

Year 3

A

$1883.24

2000

0

0

B

$ 881.66

0

1000

0

C

$1031.90

0

0

1250

D

$1401.30

400

200

1000

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Finance Basics: Calculate the arbitrage opportunity
Reference No:- TGS017840

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