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Spot: NOK 8.0000/USD Forward: NOK 8.2000/USD 12-month USD Libor: +2.00% 12-month NOK Libor: +8.00% WACC: 10.00% Call option: strike price USD 0.125/NOK, premium USD 0.0025/NOK

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Spot: NOK 8.0000/USD Forward: NOK 8.2000/USD 12-month USD Libor: +2.00% 12-month NOK Libor: +8.00% WACC: 10.00% Call option: strike price USD 0.125/NOK, premium USD 0.0025/NOK Put option: strike price USD 0.125/NOK, premium USD 0.0035/NOK Note: how to compute the call premium for NOK 100M: USD 0.0025/NOK NOK 100,000,000 - USD 250.000 You have just invested USD 1M in the "carry trade". (you have borrowed USD 1M and you have invested in the NOK). What will be your profit/loss if the exchange rate is NOK 8.5/USD one year from now? enter profits as +, enter losses as

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