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Amelia Earhart loved to trade options. In anticipation of a depreciation of the British pound from its current level of $$1\mathrm{.}50$ to $$1\mathrm{.}45,$

she purchased a call option with an exercise price of $$1\mathrm{.}51$ and a premium of $$\mathrm{.}02.$ If the spot rate at the option's maturity

turns out to be $$1\mathrm{.}54,$ what is Amelia's profit or loss per unit?

However Amelia wants to hedge so she buys a put with the same strike price of $$1\mathrm{.}51$ and an option premium of $0\mathrm{.}03.$

Call premium

Call profit

Put premium

Put profit

Net profit

Assume that Fred Noonan purchases a put option on British pounds $($with a strike price of $$1\mathrm{.}50)$ for $$\mathrm{.}05$ per unit. A pound option

represents $31,250$ units. Assume that at the time of the purchase, the spot rate of the pound is $$1\mathrm{.}51$ and continually rises

to $$1\mathrm{.}62$ by the expiration date. The highest net profit possible for the speculator based on the information above is: