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Assume that the exchange markets are not interfered by governments, that is, that the...
Assume that the exchange markets are not interfered by governments, that is, that the rates are fully flexible. Further assume that the UK pound costs $1.70.
suppose $1.69 = 1 pound in New York, and $1.71 = 1 pound in London. explain how foreign-exchange arbitrage results in the same dollar/pound exchange in New York and London
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