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Suppose you bought a December British pound call option with an exercise price of $1.3000/. The option price was $0.02/. How much is your profit

Suppose you bought a December British pound call option with an exercise price of $1.3000/. The option price was $0.02/. How much is your profit if the spot price is $1.2800/ at expiration?

$0

$0.02

-$0.04

$0.04

-$0.02

2. A call option is out-of-the-money if the spot exchange rate is greater than the exercise price.

True

False

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