1. Example of the Law of One Price
If the price of any economic good or security is inconsistent in two different free markets after considering the effects of currency exchange rates, then to earn a profit, an arbitrageur will purchase the asset in the cheaper market and sell it in the market where prices are higher. When the law of one price holds, arbitrage profits such as these will persist until the price converges across markets.
For example, if a particular security is available for $10 in Usa Market Japanese but is selling for the equivalent of $20 in Market Japanese, investors could purchase the security in Market American and immediately sell it for $20 in Market Japanese, netting a profit of $10 without any true risk or shifting of the markets.