1/ Complete the following table A Call option with a strike price of K is the: the underlying currency at a price K but not the oukoption to low A Put option with a strike price of K is the: vi the underlying foreign currency at a price K but not the so.on to SCI Strike Price Relative to Spot Rate Effect of Exercise Profit/Loss Option DescriptionCall (buy) Option In the money At the money Out of the money Put (sell) Option 52K Sei ProEt SK Consider the 90-Day Call Option on British Pounds E with a strike K- 1.70S/E .When the spot rate is $1.74/, the option is ITM and has an intrinsic value of $1.74- $1.70/E, or 4 cents per pound .When the spot rate is $1.70/E, the option is ATM and its intrinsic value is $1.70- $1.70/E, or zero cents per pound When the spot rate is is $1.66/E, the option is OTM and has no intrinsic value, only a fool would exercise this option Calculate the Intrinsic and Time value Components of the 90-Day Call Option on British Pounds E with a strike K- 1.70/E at Varying Spot Exchange Rates Strike Price $1.70/E Spot1.6611.67-1.681.6911.70 1.71-1.72-T1.731.74 Intrinsic Value Time value Total 0.0167 0.0201 0.0239 0.0282 00330 0.0382 0.0439 0.0501 0.0567 value