Cal Bank believes the US dollar will appreciate over the next five days from GHS 4.48 to GHS 4.50. The following annual interest rates apply: Currency Dollars Ghana Cedis Lending Rate 7.10% 6.80% Borrowing Rate 7.50% 7.25% Cal Bank has the capacity to borrow either GHS 10 million or $5 million. If Cal 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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Cal Bank believes the US dollar will appreciate over the next five
days from GHS 4.48 to GHS 4.50. The following annual interest rates
apply:

Currency

Dollars Ghana Cedis

Lending Rate

7.10% 6.80%

Borrowing Rate

7.50% 7.25%

Cal Bank has the capacity to borrow either GHS 10 million or $5
million. If Cal 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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