Financial information: Spot exchange rate: $1.764/ Three-month forward rate: $1.754/ (a 2.2676% per annum discount on the E ) Ganado's cost of capital: 12.0% U.K. three-month borrowing interest rate: 10.0% (or 2.5% qquarter) U.K. three-month investment interest rate: 8.0% (or 2.0% qquarter) U.S. three-month borrowing interest rate: 8.0% (or 2.0% quarter) U.S. three-month investment interest rate: 6.0% (or 1.5% /quarter) June put option in OTC (bank) market for 1,000,000 : strike price $1.75 (nearly at the money - ATM), 1.5% premium June put option in OTC (bank) market for 1,000,000 : strike price $1.71 (out of the money - OTM), 1.0% premium Ganado's foreign exchange advisory service forecast that the spot rate in three months will be $1.76/E