Question: Please find b ~ e thank you Six-month call options on 6,900,000 dirhams at an exercise price of 11.20 dirhams per dollar are available from
Six-month call options on 6,900,000 dirhams at an exercise price of 11.20 dirhams per dollar are available from Bank Al-Maghrub at a premium of 1.9%. Six-month put options on 6,900,000 dirhams at an exercise price of 11.20 dirhams per dollar are available at a premium of 3.4%. Using the exchange rate and interest rate data in the popup window. compare alternate ways below that Micca might hedge its foreign exchange transaction exposure. a. How much in U.S. dollars will Micca pay in 6 months without a hedge if the expected spot rate in 6 months is assumed to be 11.20 dirhams per dollar? 11.60 dithams per dollar? b. How much in U.S. dollars will Micca pay in 6 months with a forward market hedge? c. How much in U.S, dollars will Micca pay in 6 months with a money market hedge? d. How much in U.S. dollars will Micca pay in 6 months with an option hedge if the expected spot rate in 6 months is assumed to be less than 11.20 dirhams per dollar? e. What is your recommendation
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