A foreign currency is currently worth $1.50. The domestic and foreign risk-free interest rates are 5% and

Question:

A foreign currency is currently worth $1.50. The domestic and foreign risk-free interest rates are 5% and 9%, respectively. Calculate a lower bound for the value of a six-month call option on the currency with a of $1.40 if it is
(a) European
(b) American.
Strike Price
In finance, the strike price of an option is the fixed price at which the owner of the option can buy, or sell, the underlying security or commodity.