Sheila Thompson, a foreign exchange trader at JP Morgan Chase, can invest $1M, or the foreign currency equivalent of the bank’s short-term funds, in an uncovered interest arbitrage with the United Kingdom. Arbitrage funds available to invest $1M (or the equivalent in pounds) Spot rate ($/£) 1.4788 90-day forward exchange rate ($/£) 1.5493 Expected 90-day spot exchange rate ($/£) 1.5898 Annualized U. K. pound 90-day interest rate 23% Short Answer Question (10 points) Suppose that the 90-day interest rate in the U. S. has changed to 4.75% and this investor intends to use $1M (or the equivalent in pounds) to invest, should this investor make an uncovered or covered interest rate investment? Show your calculation(s) for this question. Which country should he or she invest in?