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You are a speculator who sells a put option on Canadian dollars for a premium of $.03 per unit, with an exercise price of $.62.
You are a speculator who sells a put option on Canadian dollars for a premium of $.03 per unit, with an exercise price of $.62. The option will not be exercised until the expiration date, if at all. If the spot rate of the Canadian dollar is $.65 on the expiration date, your net profit per unit is:
-$0.05 -$0.03 +$0.03 +$0.05 +$0.07
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