The spot rate between the U.K. and the U.S. is £.7614/$, while the one-year forward rate...

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The spot rate between the U.K. and the U.S. is £.7614/$, while the one-year forward rate...

The spot rate between the U.K. and the U.S. is £.7614/$, while the one-year forward rate is £.7540/$. The risk-free rate in the U.K. is 4.59 percent and risk-free rate in the United States is 2.74 percent. How much in profit can you earn on $11,000 utilizing covered interest arbitrage?

a.$316.41

b.$276.86

c.$103.15

d.$253.13

e.$91.68

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