If you can borrow $1,000,000, determine if there is an arbitrage opportunity. If any arbitrage...

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Accounting

If you can borrow $1,000,000, determine if there is an arbitrage opportunity. If any arbitrage opportunity exists, what is the final net CF to you assuming you conduct a covered interest parity strategy to exploit any arbitrage opportunity? You have to following information:
Spot exchange rate = $1.0500/.
IUSD: 5% per annum U.S.
IEUR: 3% per annum in Euro zone
F1-yr: $1.0704/

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