Currency Call Hedge:

You are the treasurer of Montana Corp. and must decide how to hedge (if at all) future payables of 1 million Japanese yen 90 days from now.

Call options are available with a premium of $.0001 per unit and an exercise price of $.01031 per Japanese yen. The forecasted spot rate of the Japanese yen in 90 days is:

Forecasted spot rate of the Japanese yen in 90-day

Future Spot Rate	Probability
$.01035	20%
$.01032	20%
$.01030	30%
$.01029	30%

What is the probability that the call option will be exercised if Montana purchased it?

How much is the estimated cost of currency call option hedge (in $)?