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Following information about the three-month put option contract on British pound (). Edward, who is a speculator, had purchased this put option and decided to
Following information about the three-month put option contract on British pound (). Edward, who is a speculator, had purchased this put option and decided to exercise the option shortly before the expiration date, when the spot rate of the pound was A$1.3127/. Using this information, calculate the net profit/loss from Edwards purchase. Put option premium on British pound () = A$0.0976 per unit Strike price = A$1.61 One option contract represents 10,000 A. - A$ 1865 B. A$ 1965 C. - A$ 1895 D. A$ 1997 E. None of the above.
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