For a call option of CN¥100,000 with the $0.16 exercise price and $0.0005 premium, When the spot exchange rate is $0.1602, the call option holder should __ the call? a. exercise b. not exercise

Please oll option information and correct answer

If put options on USD with a strike price of AUD6.9/USD have a premium of AUD4.3, what is the break- even price (BEP) for a buyer or a seller of these options? Assume that there are no brokerage fees. Question Answer a. The buyer's BEP is AUD 2.6000 and the seller's BEP is AUD 11.2000 b. The buyer's BEP is AUD 2.6000 and the seller's BEP is AUD 2.6000 c. The buyer's BEP is AUD 11.2000 and the seller's BEP is AUD 11.2000 d. The buyer's BEP is AUD 11.2000 and the seller's BEP is AUD 2.6000 e. The buyer's BEP is AUD 6.9000 and the seller's BEP is AUD 11.2000

26. Suppose an investor buy a European call option at price c, K is the strike price and ST is the spot price of the asset at maturity of the contract, when ( ),the investor will exercise the option.

An investor has purchased United States dollar call options, with an exercise price of A$1.15 anda premium of A$0.03 per unit.(a) Calculate the break-even price. (b) Calculate the profit or loss of the option for the investor if the spot rate at the time the investor considers exercising the options is : (1) A$1.10 (2) A$1.17 (3) A$1.23.(c) What is the maximum loss for the investor?(d) Explain why the investor could have an unlimited profit if the options are exercised.(e) Explain in general the similarities of and differences between a currency call option and a currency put option.

Which of the following statements about European option contracts is TRUE? a. Typically American options are cheaper than otherwise similar European options due to the uncertainty regarding the date of exercise. b. One can synthesise a long forward position in the underlying by being long a call and short a put c. A long call position and a short put position both involve buying the underlying and so are equivalent d. The price of an option can be obtained by computing the true probabilities of each state of nature, working out the expected option payoff across those states and then discounting back to the present.

Choose all expressions that accurately complete the statement below:   Writing a European call option on £10,000 at a strike price of $1.80/£ and a premium of $0.02/£:   Group of answer choices   Obligates the optionholder to purchase £10,000 for $18,000 USD.   Will be profitable for the seller when the price of the GBP exceeds the put-call parity rate.   Obligates the writer to sell £10,000 on the expiration date if the optionholder chooses to exercise.   Allows the optionholder to exercise the option at any point up to the expiration date.   Earns the seller a premium of $200.

For two call options on the same underlying asset and same time to maturity, the relationship c(K1) – c(K2) ≤ K2 – K₁, for K1 < K2 must hold. Otherwise, there is an arbitrage opportunity. Given the following option prices: Strike Premium 645.00 63.20 650.00 99.00 655.00 57.50 89.85 660.00 Among the four calls, there is one pair for which the above relationship is not hold and thus, one can make arbitrage. To do so, one should buy option with strike price type your answer... , and sell option with strike price type your answer... The minimum profit is type your answer... and the maximum profit is type your answer...

A MNC wishes to reduce the exposure to British pound payables, it can _________. I. Purchase pounds forward II. Buy a pound futures contract III. Buy a pound put option IV. Buy a pound call option A. I, II, III B. I, II C. II, III, IV D. I, II, IV

1. The option is currently A. In-the-moneyB. At-the-moneyC. Out-the-money 2. Determine the In/At/Out- the money by _____ 3. Determine the Intrinsic Value