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# #12) Consider the following information: Rus = 4% Ruk = 7% Eo = 2.00 dollars per pound Fo = 1.98 (1 year delivery) Where the interest rates are...

#12) Consider the following information:
Rus = 4%
Ruk = 7%
Eo = 2.00 dollars per pound
Fo = 1.98 (1 year delivery)
Where the interest rates are annual yields on U.S. or U.K. bills. Given this information.
A) Where would you lend?
B) Where would you borrow?
C) How could you arbitrage?

#12) Consider the following information:
Rus = 4%
Ruk = 7%
Eo = 2.00 dollars per pound
Fo = 1.98 (1 year delivery)
Where the interest rates are annual yields on U.S. or U.K. bills. Given this...

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