ssume the following information: Current spot rate of New Zealand dollar $.6686 Forecasted spot rate of New Zealand dollar 1 year from now $.7012 One-year forward rate of the New Zealand dollar $.6849 Annual interest rate on New Zealand dollars 5% Annual interest rate on U. S. dollars 6% Compute the return from covered interest arbitrage by a U. S. investor with $1000 to invest. Group of answer choices 5.00% 8.58% 7.55% 6.00% 2.55 %

You are the manager of a large crude-oil refinery. as part of the refining process, a certain heat exchanger (operated at high temperatures and with abrasive material flowing through it) must be replaced every year. the replacement and downtime cost in the first year is $165 comma 000. this cost is expected to increase due to inflation at a rate of 7% per year for six years (i. e. until the eoy 7), at which time this particular heat exchanger will no longer be needed. if the company's cost of capital is 15% per year, how much could you afford to spend for a higher quality heat exchanger so that these annual replacement and downtime costs could be eliminated?