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A currency dealer is considering trading between Australian dollar ( AUD ) and Norwegian Krone ( NOK ) . A put option allows the holder
A currency dealer is considering trading between Australian dollar AUD and Norwegian Krone NOK A put option allows the holder to sell NOK now at an exercise exchange rate of AUDNOK If the premium paid is Australian cents for each NOK, calculate the net payoff at the following spot exchange rates in AUDNOK :
a
b
c
d At what exchange rate will the holder break even?
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