Andrea Cujoli Is a Currency Speculator Who Enjoys "Betting" on Changes

Multiple Choice

Andrea Cujoli is a currency speculator who enjoys "betting" on changes in the foreign currency exchange market. Currently the spot price for the Japanese yen is ¥129.87/$ and the 6-month forward rate is ¥128.53/$. Andrea thinks the yen will move to ¥128.00/$ in the next six months. If Andrea buys $100,000 worth of yen at today's spot price and sells within the next six months at ¥128/$ she will earn a profit of ________.

A) $146.09
B) $101,460.94
C) $1460.94
D) nothing; she will lose money