(2 points extra credits) Given the following information, Current spot price of Euro is $1.50/euro Euro futures price is $1.60/euro with expiration date in three months. Call option on Euro: exercise price $1.50 with expiration date in three months and premium is $0.50/euro Put option Euro: exercise price $1.50 with expiration date in three months and premium is $0.40/euro. Expected exchange rate of Euro in one year: $1.40/euro. 1a) As a speculator in the currency market, how would you speculate with futures and options contracts? 2b) Suppose you are treasurer in a MNC and the MNC is going to receive 3M euro in three months. You are concerned about the dollar amount you are going to get from the euro receipt in 3 months. How would you hedge with futures and options contracts? 3c) Suppose you are treasurer in a MNC and the MNC is going to pay 3M euro in three months. You are concerned about the dollar amount you need to use in 3 months. How would you hedge with futures and options contracts? (2 points extra credits) Given the following information, Current spot price of Euro is $1.50/euro Euro futures price is $1.60/euro with expiration date in three months. Call option on Euro: exercise price $1.50 with expiration date in three months and premium is $0.50/euro Put option Euro: exercise price $1.50 with expiration date in three months and premium is $0.40/euro. Expected exchange rate of Euro in one year: $1.40/euro. 1a) As a speculator in the currency market, how would you speculate with futures and options contracts? 2b) Suppose you are treasurer in a MNC and the MNC is going to receive 3M euro in three months. You are concerned about the dollar amount you are going to get from the euro receipt in 3 months. How would you hedge with futures and options contracts? 3c) Suppose you are treasurer in a MNC and the MNC is going to pay 3M euro in three months. You are concerned about the dollar amount you need to use in 3 months. How would you hedge with futures and options contracts