Suppose the japanese yen exchange rate is 75 1 and the


Suppose the Japanese yen exchange rate is ¥75 = $1, and the British pound exchange rate is £1 = $1.54.

a. What is the cross-rate in terms of yen per pound? (Round your answer to 2 decimal places, e.g., 32.16.)

 Cross-rate ¥/£    

b. Suppose the cross-rate is ¥120 = £1. What is the arbitrage profit per dollar used?

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Financial Management: Suppose the japanese yen exchange rate is 75 1 and the
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