Assume that you have $900,000 to invest. The current spot rate of the

Assume that you have $900,000 to invest. The current spot rate of the Australian dollar is $0.62, and the 180-day forward rate of the Australian dollar is $0.64.

Furthermore, the 180-day interest rate in the United States is 3.5% and the 180-day interest rate in Australia is 3.0%. What is the net income you will have realized after 180 days if you conduct interest rate arbitrage?
A) $61,548.39
B) $56,903.23
C) $27,000.00
D) $31,500.00
E) $52,632.94

ANSWER

B