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Assume the following information regarding US and European annualized interest rates The US leading rate is 673% The US borrowing rate is 720% The European leading rate is 680% The Europe

Assume the following information regarding U.S. and European annualized interest rates: The U.S. leading rate is 6.73%; The U.S. borrowing rate is 7.20%; The European leading rate is 6.80%; The European borrowing rate is 7.28%. A bank can borrow either $20 million or 20 million. The current spot rate of the euro is $1.13. Furthermore, the bank expects the spot rate of the euro to be $1.10 in 90 days. What is the bank's dollar profit from speculating if the spot rate of the euro is indeed $1.10 in 90 days?

   

$579,845.

   

$583,800.

   

$588,200.

   

$584,245.

 

Apr 15 2020 View more View Less

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