# Profit from Triangular Arbitrage Alabama Bank is willing to buy or sell British pounds for \$1.98. The bank is willing to buy or sell Mexican pesos at an exchange rate of 10 pesos per dollar. It is willing to purchase British pounds at an exchange rate of 1 peso = 0.05 British pound. Show how you can make a profit from triangular arbitrage and what your profit would be if you had \$100,000.

FindFind

### International Financial Management

14th Edition
Publisher: Cengage
ISBN: 9780357130698
FindFind

### International Financial Management

14th Edition
Publisher: Cengage
ISBN: 9780357130698

#### Solutions

Chapter 7, Problem 48QA
Textbook Problem

## Profit from Triangular Arbitrage Alabama Bank is willing to buy or sell British pounds for \$1.98. The bank is willing to buy or sell Mexican pesos at an exchange rate of 10 pesos per dollar. It is willing to purchase British pounds at an exchange rate of 1 peso = 0.05 British pound. Show how you can make a profit from triangular arbitrage and what your profit would be if you had \$100,000.

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