Suppose that in the situation of Table 1.1 a corporate treasurer said: I will have 1 million
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Suppose that in the situation of Table 1.1 a corporate treasurer said: “I will have
£1 million to sell in 6 months. If the exchange rate is less than 1.41, I want you to give me 1.41. Ifit is greater than 1.47, I will accept 1.47. If the exchange rate is between 1.41 and 1.47, I will sell the sterling for the exchange rate.” How could you use options to satisfy the treasurer?
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