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1 . LSU Corp purchased Canadian dollar call options for speculative purposes. If these options are exercised, LSU will immediately sell the Canadian dollars in
LSU Corp purchased Canadian dollar call options for speculative purposes. If these options are exercised, LSU will immediately sell the Canadian dollars in the spot market. Each option was purchased for a premium of US$ per unit, with an exercise price of US$ CAD. LSU plans to wait until the expiration date before deciding whether to exercise the options. Of course, LSU will exercise the options at that time only if it is feasible to do so Fill in the net profit or loss per unit to LSU Corp based on the listed possible spot rates direct quote of the Canadian dollar on the expiration date
Possible spot rate of CAD on expiration date Net Profit Loss per unit
US$CAD
US$CAD
US$CAD
US$CAD
US$CAD
US$CAD
Auburn Co purchased Canadian dollar put options for speculative purposes. Each option was purchased for a premium of US$ per unit, with an exercise price of US$CAD. Auburn will purchase the Canadian dollars just before it exercises the options if it is feasible to exercise the options It plans to wait until the expiration date before deciding whether to exercise the options. In the following table, fill in the net profit or loss per unit to Auburn Co based on the listed possible spot rates direct quote of the Canadian dollar on the expiration date
Possible spot rate of CAD on expiration date Net Profit Loss per unit
US$CAD
US$CAD
US$CAD
US$CAD
US$CAD
US$CAD
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