Question: 38 . The current spot exchange rate is $1 .55 = El .DO and the three - month forward rate is $1 60 El .DO

38 . The current spot exchange rate is $1 .55 = El .DO and the three - month forward rate is $1 60 El .DO . Consider a three - month American call option on 62 500 with a strike price of $1 .50 El .DO . If you pay an option premium of $5 090 to buy this call at what exchange rate will you break - even ? A . $1. 58 = EL. DO B. $1 . 62 = E1.DO C. 5150 = 6100 D . $1 60 = ELDO

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