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Q32 Assume the current spot rate is C$1.1415 and the one-year forward rate is C$1.1252....

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Finance

Q32 Assume the current spot rate is C$1.1415 and the one-year forward rate is C$1.1252. The nominal risk-free rate in Canada is 7.8 percent while it is 7.2 percent in the U.S. Using covered interest arbitrage, you can earn a profit of ___ for every $1 invested over the next year.

-$.0040

$.0163

$.0216

-$.0088

-$.0840

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