Suppose that the values of the dollar-euro exchange rates


Suppose that the values of the dollar-euro exchange rates are as follows: in New York $1.19 per euro, and in Tokyo $1.21 per euro. Describe how investors could use arbitrage to take advantage of the difference in exchange rates. Explain how this process will affect the dollar price of the euro in New York and Tokyo.

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Macroeconomics: Suppose that the values of the dollar-euro exchange rates
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