PLEASE EXPLAIN ALL STEPS AND INFORMATION ON HOW TO ANSWER THIS AND WHY THE ANSWER IS CORRECT, NOT JUST ANSWER THE QUESTION. THANK YOU SO MUCH.

1.Assume that a speculator purchases a put option on British pounds (with a strike price of $1.50) for $.07 per unit. A pound option represents 31,250 units. Assume that at the time of the purchase, the spot rate of the pound is $1.51 and continually rises to $1.62 by the expiration date. The highest net profit possible for the speculator based on the information above is:

A.$2187.5

B.$-2187.5

C.$3437.5

D.$1250.0