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International Automobile Parts (IAP) holds a call option to purchase US dollars. The strike price on the call option is JPY 115/USD. IAP paid JPY

International Automobile Parts (IAP) holds a call option to purchase US dollars. The strike price on the call option is JPY 115/USD. IAP paid JPY 10 for the option. The spot price is JPY 120/USD, and the option expires today. Should IAP exercise the option? What is IAPs payoff?

Global Producers (GP) holds a put option to sell US dollars. The strike price on the put option is JPY 114/USD. GP paid JPY 10 for the option. The spot price is JPY 120/USD, and the option expires today. Should GP exercise the option? What is GPs payoff?

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