Business, 18.08.2020 19:01, shetherealbrat

Baylor Bank believes the New Zealand dollar will appreciate over the next five days from $.48 to $.50. The following annual interest rates apply: Currency Lending Rate Borrowing Rate
Dollars 7.00% 7.50%
New Zealand dollar (NZ$) 6.75% 7.25%
Baylor Bank has the capacity to borrow either NZ$10 million or $5 million.
If Baylor Bank's forecast is correct, what will its dollar profit be from speculation over the five-day period (assuming it does not use any of its existing consumer deposits to capitalize on its expectations)?

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Baylor Bank believes the New Zealand dollar will appreciate over the next five days from $.48 to $.5...