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show me the work A 1-year call option on the British pound has a strike price of $1.30/. The spot interest rate today is $1.25/
show me the work
A 1-year call option on the British pound has a strike price of $1.30/. The spot interest rate today is $1.25/ and the interest rates in the US and the UK are 1% and 2%, respectively. If the pound can only appreciate to $1.50/ or depreciate to $1.10/ in a year, which of the following statements is correct? The call option should be valued at $0.0682/ today, The call option will be worth $0.30 if the pound appreciates. The call option has no value today. The hedge ration of the call option is 25% Step by Step Solution
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