d. negative profit, so exercise would not occur 8. Consider you bought a three-month American put option on 10,000 with a strike price of S1.40 /. The option premium is S0.0045/. The current spot exchange rate is $1.30/. Immediate exercise of this put option will generate a net payoff of (put premium included) a. $1,000 b. $955 c. $1,045 d. negative profit, so exercise would not occur