QUESTION 2 (10 MARKS) Tunas Mekar Bhd has decided to venture into a new project...
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QUESTION 2 (10 MARKS) Tunas Mekar Bhd has decided to venture into a new project with a UK based company. The capital required for this project is 12 million needed in 6 months time. The company decides to borrow the amount and finds that the 6 months interest rate in UK is 3.50% and in Malaysia is 2.5%. At present the exchange rate is RM5.1630/ and the 6-months forward rate is RM5.1950/. Based on the information, how much would the interest arbitrage profit (loss) be?
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