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Yes, because the intrinsic Interest rate in the Us is less than the market rate Question 9 3 pts Suppose that the exchange rate is

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Yes, because the intrinsic Interest rate in the Us is less than the market rate Question 9 3 pts Suppose that the exchange rate is 1.25 = 1.00. Options (calls and puts) are available on the London exchange in units of 10,000 with strike prices of 0.80 = 1.00. Options (calls and puts) are available on the Frankfurt exchange in units of 10,000 with strike prices of 1.25 = 1.00. How many call or put options should the UK firm to hedge a 100,000 receivables? Buy 8 put options on the euro with a strike in pounds. O Buy 10 put options on the euro with a strike in GBP. Both strategies work. Question 10 3 pts

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