Question
Question 1 The euro is currently trading at 1.40 euros per dollar.The interest rate on the US Treasury Bill is 0.029 and the risk free
Question 1
The euro is currently trading at 1.40 euros per dollar.The interest rate on the US Treasury Bill is 0.029 and the risk free interest rate in Europe is 0.007.What is the arbitrage free future exchange rate between the euro and the U.S. dollar for two years in the future in euros per dollar?
Question 2
An investor buys a call option on EBAY with a strike price 17.0, and a call premium of 2.If EBAY expires at 31, what profit did the investor make? Each option covers 100 shares of the underlying stock.
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Foundations of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta
10th Canadian edition
1259261018, 1259261015, 978-1259024979
