Chapter 8, Problem 5BIC

Given the following information, are there geographic arbitrage opportunities available? If so, what level of additional transaction costs in each market will eliminate this opportunity? (All quotes are at time 0). Quotes for the US dollar in South Korea: 1361-1385 Quotes for the South Korean Won in the US: 0.000741 - 0.000762.

Many people were surprised when Indonesia became t- In December 2018 the government of Pakistan officially changed the value of the Pakistan Rupee from 121.04 rupee per dollar to 155.24 rupee per dollar. What was the percentage change in its value? Was this a depreciation, devaluation, appreciation, or revaluation? Explain.he one of the largest rubber producing country in the world in recent years, after Brazil and Vietnam. The Indonesian Rupiah, Rp, is managed currency and not traded widely. You are a trader and purchase rubber for manufacturing the tires. As you reach Indonesia, you find different exchange rates are offered by different dealers with their commission fees. If you have 21,000 Euros with you, which dealer is in your best interest to exchange the money from Euro to Indonesian Rupiah

You have two friends: Rose and Frank. Rose is optimistic about the influx of Chinese capital in the LAC region. She believes that this not only provides an opportunity for the region to grow faster but also paves the way for durable trade connections within and beyond the region.Frank, however, is sceptical. He considers the Chinese money a backdoor invasion where the PRC would use the region only to establish and expand its soft power and most benefits that arise from mergers, acquisitions and other forms of investments would be skewed in China’s favour. You are required to provide an informed view on the matter with an aim to resolve the dispute between Rose and Frank.