Show how british arbitrageurs can make profits given that


Question - Assume that back in 1995 the British pound (£) is worth FF9.80 in Paris and SFr5.40 in Zurich. Swiss franc (SFr) is worth two French francs (FF). That is, S(FF/£) = FF9.80, S(SFr/£) = SFr5.40, and S(FF/SFr) = FF2. Show how British arbitrageurs can make profits given that the Swiss franc is worth two French francs. What would be the profit per pound transacted?

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Accounting Basics: Show how british arbitrageurs can make profits given that
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