A U.S. firm has sold an Italian firm 1,000,000 worth of product. In one year the U.S. firm gets paid in euros. To hedge, the U.S. firm bought an option on the euro with a strike price of $1.65 per euro and pay an option premium of $0.01 per euro. If at maturity the rate is $1.60 per euro:

a.none of the other choices

b.the firm will realize $1,650,000 on the sale net of the cost of hedging.

c.the firm will realize $1,640,000 on the sale net of the cost of hedging.

d.the firm will realize $1,645,000 on the sale net of the cost of hedging