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You are considering the purchase of seven three month Canadian dollar call options with a striking price of 98 cents per Canadian dollar. The premium
You are considering the purchase of seven three month Canadian dollar call options with a striking price of 98 cents per Canadian dollar. The premium is 1.15 per contract. The spot price is currently 97.44 cents per Canadian dollar and the 90-day forward rate is 97.87 cents. You believe the Canadian dollar will appreciate to 99 cents per Canadian dollar over the next three months. Thus, graph the call option cash flow schedule including the profit, loss and break-even
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