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I need help solving these questions. Thank you 43. The spot price is 1.15$/C. The exercise price of a call on the euro is 1.12$/6.
I need help solving these questions. Thank you
43. The spot price is 1.15$/C. The exercise price of a call on the euro is 1.12$/6. The US rate is 4% while the euro rate is 2.5%. The volatility of the euro is 17%. The time to expiration of the call is 20 days. What is the value of the call on the euro? 44. What is the value of the put corresponding to the call in preceding question? 45. You own a bond that has a Macaulay duration of 6 years and a price of $970. You believe the Fed is about to increase interest rates by 25 basis points. You assume the yield on your bond will also increase by 25 basis points. What is the predicted new price of the bond Step by Step Solution
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