1) Assume the following information:                                                                                                             Quoted Price       Value of Canadian dollar in U

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1) Assume the following information: 

 

                                                                                                         Quoted Price

      Value of Canadian dollar in U.S. dollars                                               $0.96

      Value of New Zealand dollar in U.S. dollars                                         $0.30

      Value of Canadian dollar in New Zealand dollars                             NZ$3.00

      

a. Calculate the profit from triangular arbitrage if you start with $1,000,000, show steps.

b. Canadian dollar with respect to the U.S. dollar would rise, True or False? No explanation required.

c. The value of the Canadian dollar with respect to the New Zealand dollar would decline, True or False? No explanation required.

d. The value of the New Zealand dollar with respect to the U.S. dollar would fall. True or False? No explanation required.