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answers you use your cale Suppose that the spot price of a Canadian dollar is U.S. $0.93 and that the exchange rate has a 1. volatility of 5% per year. Risk-free interest rates are 6% in the U.S. and 4% in Canada. a. Calculate the price of a 6-month European call option to buy one Canadian dollar for U.S. $0.93. Express your answer in terms of the cumulative normal distribution function, N(x), as in the answers to question 16 in part 1. b. What is the price of a 3-month option to buy U.S. $0.93 for one Canadian dollar? answers you use your cale Suppose that the spot price of a Canadian dollar is U.S. $0.93 and that the exchange rate has a 1. volatility of 5% per year. Risk-free interest rates are 6% in the U.S. and 4% in Canada. a. Calculate the price of a 6-month European call option to buy one Canadian dollar for U.S. $0.93. Express your answer in terms of the cumulative normal distribution function, N(x), as in the answers to question 16 in part 1. b. What is the price of a 3-month option to buy U.S. $0.93 for one Canadian dollar?
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