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Suppose the exchange rate is $1.51/. Let r $ = 6%, r = 7%, u = 1.34, d = 0.73, and T = 2. Using

Suppose the exchange rate is $1.51/. Let r_$ = 6%, r = 7%, u = 1.34, d = 0.73, and T = 2. Using a 2-step binomial tree, calculate the value of a $1.45-strike European call option on the euro.


Answers:	a. $0.2425
	b. $0.2361
	c. $0.2151
	d. $0.2284
	e. $0.1960

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