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Arbitrage profit per dollar or dollar-equivalent borrowed

Problem: Suppose that six-month interest rates (annualized) in Japan and the United States are 7 percent and 9 percent, respectively. If the spot rate is ¥142:$1 and the ninety-day forward rate is ¥139:$1 and the 180 day forward rate is: ¥152:$1.

Assuming no transaction costs, what would be your arbitrage profit per dollar or dollar-equivalent borrowed?

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Finance Basics: Arbitrage profit per dollar or dollar-equivalent borrowed

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