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An investor is bullish on the euro and believes it will increase against the Japanese Yen. The investor purchases a currency call option on the

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An investor is bullish on the euro and believes it will increase against the Japanese Yen. The investor purchases a currency call option on the euro with a strike price (exchange rate) of #125/. When the investor purchases the contract, the spot rate of the euro is equivalent to X125/. Assume the euro's spot price at the expiration date (market price) is #134/. the premium is W2/ a) Assume the euro's spot price at the expiration date (market price) is #1347 The investor's profit = \/ b) Assume the euro's spot price at the expiration date (market price) is \122/ The investor's profit = c) What is the maximum loss Maximum loss = JE/

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