QUESTION 89 Tpoint (a) Assume that the dollar-euro spot rate is $1.28 and the six-month forward rate is Freien-$1.28 $1.2864. The se month US dollarate is percent and the Eurodollar rate is 4 percent. What is the minimum pric that a sh month American call option with a striking price of $1.25 should sell forina rational market? bi Use the binomial option pricina model to find the value of a call otion on 10.000 with a strike price of 12,500. The current exchange rate is 1.501.00 and in the next period the exchange rate can increase to 240/ or decrease to 60.975/1.000,00 1.6 and 1/0,625). The current interest rates and are TTT Anal (26T. 3 QUESTION 89 Tpoint (a) Assume that the dollar-euro spot rate is $1.28 and the six-month forward rate is Freien-$1.28 $1.2864. The se month US dollarate is percent and the Eurodollar rate is 4 percent. What is the minimum pric that a sh month American call option with a striking price of $1.25 should sell forina rational market? bi Use the binomial option pricina model to find the value of a call otion on 10.000 with a strike price of 12,500. The current exchange rate is 1.501.00 and in the next period the exchange rate can increase to 240/ or decrease to 60.975/1.000,00 1.6 and 1/0,625). The current interest rates and are TTT Anal (26T. 3