A call option on British pounds has a strike (or exercise) rate of $1.48/BP and the current spot rate is $1.55/BP. This option can be referred to as:
Whenever the current spot rate is greater than the exercise rate, the option is referred to as the in the money option.
Since the current spot rate of $ 1.55/ BP is greater than the exercise rate of $ 1.48 / BP, this option can be referred to as the in the money option.
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A call option on British pounds has a strike (or exercise) rate of $1.48/BP and the...
A put option on British pounds has a strike (exercise) price of $1.48. The present exchange rate is $1.55. This put option can be referred to as:
Randy Rudecki purchased a call option on British pounds for $.02 per unit. The strike price was $1.45 and the spot rate at the time the option was exercised was $1.46. Assume there are 31,250 units in a British pound option. What was Randy’s net profit on this option?
Randy Rudecki purchased a call option on British pounds for $.02 per unit. The strike price was $1.45 and the spot rate at the time the option was exercised was $1.46. Assume there are 31,250 units in a British pound option. What was Randy‘s net profit on this option? Show your work.
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