Question: Please help me solve a, b, c and d Onsenty S1.2758 k on rc 2. (Currency Put Option) PHLX U.S. Dollar Settled World Currency Options

Please help me solve a, b, c and d

Please help me solve a, b, c and d Onsenty S1.2758 k

on rc 2. (Currency Put Option) PHLX U.S. Dollar Settled World Currency

Onsenty S1.2758 k on rc 2. (Currency Put Option) PHLX U.S. Dollar Settled World Currency Options (European style) are traded on NASDAQ. Euro spot rate is currently $1.2758/. One currency trader buys one NOV euro (code: XDE) put option with a strike price of 129.00 at the ask price of 3.15 (online quote) The contract size is 10,000 euros per contract. Assume the final cash settlement value is 131.60 at option expiration. (a) At the spot rate of S1.2758/E, is this put option in or out of the money? (b) At the spot rate of S1.2758/E, what is the time value of this put option contract? (c) What is the net profit or loss (S) of this currency trader at option expiration? (Ignore trading commission) (d) At what settlement vale (two decimal places) could the currency trader break even at option expiration? (Ignore trading commission) (oins qwo at 2 (a) In the money (b) S173 (c) S-315 (loss of $315) (d) 125.85

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