Question

23. (20 points) There is a call option for Euros with a strike price of $1.10 and a premium of $.06.T for Euros with a strike price of $1.18 and a You do not expect the Euro to fluctuate much at all. Therefore you decide to short both of these two options. premium of $0.04. The current spot rat is $1.15 per Euro. Please draw the final contingency graph (including break even, max loss, max gain). You may draw the individual ones to help you with the final one but you will only get credit if the final graph is correct

Answer 1

or b o 4 Rate Call Put Stnke l18 Toto loss = .v5+.03-0.og Total pre mium Collectod-oHo Coblicteol xsed hut has 0% 010 omv Hatinum Gain- 0.01 ว่า(e Remain beta en l'lo fol. 18