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1. As exporter, Berjaya Berhad has to sell USD10 million sometime during the next six months, and would like to lock-in a minimum MYR value

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1. As exporter, Berjaya Berhad has to sell USD10 million sometime during the next six months, and would like to lock-in a minimum MYR value for this. The price of an option with a strike price of K= MYR4.15/USD is MYRO.012/USD. (a) What option should the exporter buy? (b) Compute the premium paid. (c) What is the floor that Berjaya Berhad has set on the price of the USD? (d) What is the actual amount that the company receives if the spot rate at the end of six months is MYR4.30/USD? (e) What is the actual amount that the company receives if the spot rate at the end of six months is MYR4.05/USD

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