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You have $43,000 and observe the following exchange rates: Exchange rate...

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Finance

You have $43,000 and observe the following exchange rates:

Exchange rate Bid Ask
Value of euro in U.S. dollars $1.15 $1.16
Value of Swiss franc in U.S. dollars $1 $1.01
Value of euro in Swiss francs CHF1.1 CHF1.11

1. Is there an arbitrage opportunity? If so, what should you do to exploit it?

- Yes: buy Swiss francs with euros

- No

- Yes: buy euros with Swiss francs

2. What is your profit from exploiting the opportunity once (in $)?

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