Question: please explain why The British pound () is currently worth 0.8 euros (). This can either increase by u = 1.05 or decrease by d

please explain why The British pound () is currently worth 0.8

please explain why

The British pound () is currently worth 0.8 euros (). This can either increase by u = 1.05 or decrease by d = 0.7 over each 2 months. Consider a European put option with a strike price of K = 0.9 per and time-to-maturity T = 4 months. The continuously compounded risk-free rate in Britain is 9% per annum and in Europe is 7% per annum. What is the price of the European put option today? Please add your answer here: Number The British pound () is currently worth 0.8 euros (). This can either increase by u = 1.05 or decrease by d = 0.7 over each 2 months. Consider a European put option with a strike price of K = 0.9 per and time-to-maturity T = 4 months. The continuously compounded risk-free rate in Britain is 9% per annum and in Europe is 7% per annum. What is the price of the European put option today? Please add your answer here: Number

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