1. Angie has been offered Can$164 for £100. How much profit can she earn on a triangle arbitrage if the official rate is $1 = Can$1.1268 and the USD equivalent of £1 is 1.4809? Assume she currently has only $100 in cash.       48) ______

A) $1.37          B) $1.75          C) $1.09          D) $.57            E) $.73

2. You are expecting a payment of Can$138,000 two years from now. The risk-free rate of return is 2.7 percent in Canada and 3.1 percent in the U.S. The current exchange rate is Can$1.1415 = $1. Approximately how much will the payment 2 years from now be worth in U.S. dollars? 50) ______

A) $122,300 B) $144,169 C) $148,319 D) $121,867 E) $156,271