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Suppose that E=$1.25/, US interest rates are 2%, UK interest rates are 4%, and the current spot exchange rate is $1.20/. In the next period

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Suppose that E=$1.25/, US interest rates are 2%, UK interest rates are 4%, and the current spot exchange rate is $1.20/. In the next period the spot exchange rate will either go up to $1.38/ or down to $1.044/. Use the binomial option pricing model to determine the value of a call on the pound

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