What kind of possible arbitrage might occur, International Economics

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What kind of possible arbitrage might occur

Problem

Assume the law of one price holds. The exchange rate is $1.5 = £1.

a) If a sweater sells for $45 in New York, what is its price (in £) in London?

b) What kind of possible arbitrage might occur if the sweater sells for £28 in London?

c) What kind of possible arbitrage might occur if the sweater sells for £35 in London?

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International Economics: What kind of possible arbitrage might occur

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