On December 1, 20x1 Henry made a sale to a customer in France; the sales price was 100,000 Euros.The customer had until March 1, 20x2 to pay.On the same day, December 1, 20x1, Henry paid $1,000 for a put option to sell Euros at a strike price of $1.10 per Euro on March 1, 20x2; $1.10 per Euro was also the spot rate on December 1, 20x1.On December 31, 20x1, the spot rate was $1.20 per Euro and the put option's fair market value was $0.02 per Euro.

Part A) What is the fair value of the put option on December 1, 20x1

A. $200

B. $10,000

C. $1000

D. $500

Part B) What is the fair value of the put option on December 31, 20x1?

$0

$1500

$10,000

$2000