How much is your arbitrage profit in Euros at expiration, if you know that the current exchange rate...

How much is your arbitrage profit in Euros at expiration, if you know that the current exchange rate is

Euro 1.2 / GBP, the 60-day forward rate is Euro 1.18 /GBP, the risk free rate in Europe is 2% and the risk free rate in the UK is 3.2%?

Make your calculation so that the spot transaction is for GBP 500,000.

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jeff jeffy answered 5 months ago

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