Yize Shen at Sumatra Funds. Yize Chen trades cur$-$

rencies for Sumatra Funds in Jakarta. She focuses

nearly all of her time and attention on the U$.$S$.$ dol$-$

lar $($USD$)$ to Singapore dollar $($SGD$)$ cross$-$rate.

The current spot rate is USD$0\mathrm{.}6000=$ SGD$1\mathrm{.}00.$

After considerable study, she has concluded that

the Singapore dollar will appreciate versus the U$.$S$.$

dollar in the coming $90$ days, probably to about

USD$0\mathrm{.}7000=$ SGD$1\mathrm{.}00.$ She has the following op$-$

tions on the Singapore dollar to choose from:

a$.$ Should Yize buy a put on Singapore dollars or a

call on Singapore dollars?

b$.$ What is Yize's break$-$even price on the option

purchased in part $($a$)?$

c$.$ Using your answer from part $($a$),$ what are Yize's

gross profit and net profit $($including premium$)$

if the spot rate at the end of $90$ days is indeed

USD$0\mathrm{.}7000?$

d$.$ Using your answer from part $($a$),$ what are

Yize's gross profit and net profit $($including pre$-$

mium$)$ if the spot rate at the end of $90$ days is

USD$0\mathrm{.}8000?$