Answer:
Check the explanation
Explanation:
a. Calculate Christoph’s expected profit assuming a pure spot market speculation strategy.
Details                                                                                     Amount
Number of Swiss francs can buy and   
invest with $100,000 ($100,000/$0.5820)                      171821.31
After 3 months SF's are sold to acquire 
dollars back   SF 171821.31* $0.6250)                                      $107,388
Less: Invested dollars                                                       $ 100,000.00
expected profit assuming he buys or sells 
SF three months forward                                                        $7,388
b. Calculate C’s expected profit assuming he buys or sells SF three months forward:
Details                                                                         Amount
Number of Swiss francs can buy and
invest with $100,000 ($100,000/$0.5640              $ 177304.96
After 3 months SF's are sold to acquire 
dollars back   SF 177,304.96* $0.6250)                   $ 110,815.60
Less: Invested dollars                                               $ 100,000.00
expected profit assuming he 
buys or sells SF three months forward                         $10,816