Suppose that you have collected the following market data: Spot rate now: USD 1.38/GBP 3-month forward: USD 1.35/GBP Call option: strike price USD 1.4/GBP, premium $0.04/GBP Put option: strike USD 1.4/GBP, premium $0.03/GBP. Plot the pay-off for the [1] Buyer of the forward contract, [2] seller of the call option, [3] buyer of the put option.

1) You are considering buying the call option. What will be your pay-off if the market rate is USD 1.39/GBP?

2)You are considering buying the call option. What will be your pay-off if the market rate is USD 1.42/GBP?

3)You are considering buying the call option. What will be your pay-off if the market rate is USD 1.45/GBP?

4)You are considering buying the put option. What will be your pay-off if the market rate is USD 1.39/GBP?

5) You are considering buying the put option. What will be your pay-off if the market rate is USD 1.42/GBP?