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Suppose you are running several Starbucks stores and planning to import 10 sets of tables and chairs from a Chinese manufacturer in half a year
Suppose you are running several Starbucks stores and planning to import 10 sets of tables and chairs from a Chinese manufacturer in half a year from now. The payment would be denominated in Yuan. One set of tables and chairs is marked as 4000. 1. Check the spot exchange rate of \/$ today (at the date you are doing your assignment), and estimate the trend of the exchange rate in 6 months, and write up an option contract. 2. Make sure to specify the strike price, and the price of the call option. Also, analyze the potential loss and gain in $ amount under two different scenarios: Option contract is to be exercised Option contract expires
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