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An Omani Exporter will receive EUR 100,000 after 30 days. To protect from the risk of depreciation in EUR he purchased an option contract and
An Omani Exporter will receive EUR 100,000 after 30 days. To protect from the risk of depreciation in EUR he purchased an option contract and locked the price at OMR 0.4619 = 1 EUR with 1%. On maturity the EUR depreciates and the exchange rate is OMR 0.4575 = 10MR in the open market. Determine the gain or loss to the exporter if option right is exercised. a. Loss OMR 440 b. Loss OMR 462 c. Gain OMR 462 d. Gain OMR 440
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