### Multiple Choice: Exchange rate, triangle arbitrage, relative purchasing power parity, inflation, foreign exchange market,

1) Currently, $1 will buy C$1.36 while $1.10 will buy ?1. What is the exchange rate between the Canadian dollar and the euro? A. C$1 = ?1.10 B. C$1 = ?.9091 C. C$1 = ?1.2364 D. C$1.36 = ?1.10 E. C$1.36 = ?.9091 2) Assume that you can buy 245 Canadian dollars with 100 British pounds. How much profit can you earn on a t