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You plan on conducting a carry trade with $2,000,000 based on the opportunity of differences...

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Finance

You plan on conducting a carry trade with $2,000,000 based on the opportunity of differences in interest rates between the U.S. Dollar (USD) and the South African Rand (ZAR). USD has a lending rate of 4% and a borrowing rate of 6%. ZAR has a lending rate of 8% and a borrowing rate of 11%.

What would your profit be in the currency values remain the same? How about if the dollar appreciates by 2%? (show your work in excel)

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