Question: Can you answer question D? Matt works for a currency trader. He expects that the Australian dollar (AUD) will appreciate versus the U.S. dollar over

Can you answer question D? Matt works for a currency trader. He expects that the Australian dollar (AUD) will appreciate versus the U.S. dollar over the coming 90 days. The current spot rate is $0.5750/AUD. Matt has the following options available based on the Australian dollar as shown in Table 6.1: Table 6.1. Australian Dollar Current spot rate (US$/AUD) $0.5750 Days to maturity 90 Option choices on the AUD): Call option Put option Strike price (US$/AUD) $0.6000 $0.6000 Premium (US$/AUD) $0.0149 $0.0004 A. Which option should Matt buy? B. What is Matts breakeven price on the option purchased? C. What is Matts gross profit and net profit (including premium) if the ending spot rate is $0.6600/AUD? D. What is Matts payoff if the spot rate is $0.5550/AUD

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