Question
The current spot price is S0= $1.1200/, the volatility of the exchange rate is = 9.5%. For a 125 days call option with Strike price
The current spot price is S0= $1.1200/, the volatility of the exchange rate is = 9.5%. For a 125 days call option with Strike price = $1.1500/, what is the intrinsic current value of the option premium by using binomial option-pricing model? Assume prevailing forward rate F125day = $1.1500/, USD interest rate for 125 days is r$ = 2%. Eulers e = 2.71
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Foundations of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
14th edition
007745443X, 978-0073530727, 73530727, 978-0077454432
