Phillips 66, Inc. (a U.S. based firm) negotiates a conditional currency call options with a bank to hedge its accounts payable of 500 million Jamaican dollars due on November 30. Phillips 66 will only exercise its option on the due date. The terms of the conditional currency call options are as follows:

K (exercise price) = $0.0068 per Jamaican dollar, Trigger = $0.0065 per Jamaican dollar, premium = $0.0018 per Jamaican dollar, expiration date = November 30.

If the spot rate on the due date, i.e., November 30, is $0.0066 per Jamaican dollar, what is the amount of U.S. dollar Phillips 66 expects to pay for its 500 million Jamaican dollars?

$4.2 million.

$3.4 million.

$4.3 million.

$3.3 million.