Assume that the pound can be exchanged for a very special co…

Assume that the pound can be exchanged for a very special coffee at £20 per ounce and the dollar is pegged to that same grade coffee at $35 per ounce. If the current market exchange rate is $1.60 per pound, can a trader take advantage of this situation and make a riskless profit? If yes, how much would the profit be in percentages? If no, how much would the loss be in percentages? Ignore transaction costs and taxes.

You note the following yield curve in The Wall Street Journa…

You note the following yield curve in The Wall Street Journal. According to the unbiased expectations theory, what is the one-year forward rate for the period beginning two years from today, 3f1?  Maturity Yield One day   2.45 % One year   2.57   Two years   2.71   Three years   2.62