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ABC corporation will be receiving C$200,000 in 90 days. Currently, a 90 day call option with an exercise price of $.69 and a premium of
ABC corporation will be receiving C$200,000 in 90 days. Currently, a 90 day call option with an exercise price of $.69 and a premium of one cent is available. Also, a 90 day put option with an exercise price of $.66 and a premium of one cent it is available. ABC plans to purchase options to hedge its receivable position. Assuming that the spot rate in 90 days is $.72, what is the net amount receipt from the currency option hedge?
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