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4. You wish to take a vacation in Japan next year, and you want to protect yourself against changes in the exchange rate. If the
4. You wish to take a vacation in Japan next year, and you want to protect yourself against changes in the exchange rate. If the current exchange rate is 90Yen/$, r$ = 0.04, rY = 0.06, and a put option to sell 50,000 Yen for $500 in one year costs $25, what would a call option to buy 100,000 Yen for $1000 cost? (A) $68 (B) $125 (C) $136 (D) $163 (E) $198
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