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(15 points) Bank of America expects that the Brazilian real will depreciate against the U.S....

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(15 points) Bank of America expects that the Brazilian real will depreciate against the U.S. dollar from its spot rate of $0.27 to $0.25 in 60 days. The following interbank lending and borowing rates exist Lending Rate Borrowing Rate U.S. dollar 3.5% 4% Brazilian real 11% 12% Bank of America considers borrowing 10 million Brazilian real in the interbank market and investing the funds in dollars for 60 days. Estimate the profits (or losses) that could be earned from this strategy. Should Bank of America pursue this strategy

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