You graduate and begin trading currencies for ING Bank in Amsterdam. You trade on behalf of wealthy private investors who, with a minimum stake of 100,000 each, wish to speculate on currencies. Due to increasingly populist politics in several EU countries, you expect the euro will fall to $1.050 / in the next 60-120 days. Suppose the current spot rate is $1.120 / . You see the following available options on the euro: Option choices on : Call #1 Call #2 Put #1 Put #2 Put #3 Strike price (US$/ ) $1.150 $1.170 $1.100 $1.100 $1.070 $0.030 $0.030 $0.040 $0.020 $0.020 Premium (US$/ ) 60 120 120 120 60 Maturity (days) a. Should you buy a call or a put on the euro? Explain. [3] b. Pick one of the options (clearly write which, e.g. Call #1, Put #1, etc.) and show the breakeven price per for it. [3] c. Using your choice from part b. show the net profit (or loss) per if the future spot rate is $1.050/. [4] d. Which of the options appears best? Show the totalexpected USD profit and return, and justify your choice. [5]