Question $8$

Justbrowsing Corp. will need to take out a $120-$day, $$200,000$ loan $60$ days from now. To protect against interest rat $lon$

an interest rate

$($call$/$put$)$ option with the premium payed on day $t=$

The option has $x=8\mathrm{.}26\%$ and expires in $60$ days.

The corporation will make a decision on day $t=$

$|$ about whether or not to exercise the option. On this day the applicable $($spot$)$ interest rate is $9\mathrm{.}15\%.$ The corporation