Suppose the current exchange rate is $1.76/, the interest rate in the United States is 5.28%,...
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Suppose the current exchange rate is $1.76/£, the interest rate in the United States is 5.28%, the interest rate in the United Kingdom is 3.88%, and the volatility of the $/£ exchange rate is 10.4%. Use the Black-Scholes formula to determine the price of a six-month European call option on the British pound with a strike price of $1.76/£. The corresponding forward exchange rate is $ /£. (Round to four decimal places.) Using the Black-Scholes formula d, is, while N₁ is. (Round to four decimal places.) (Round to four decimal places.) Using the Black-Scholes formula d₂ is. while N₂ is The price of the call is $£. (Round to four decimal places.) Suppose the current exchange rate is $1.76/£, the interest rate in the United States is 5.28%, the interest rate in the United Kingdom is 3.88%, and the volatility of the $/£ exchange rate is 10.4%. Use the Black-Scholes formula to determine the price of a six-month European call option on the British pound with a strike price of $1.76/£. The corresponding forward exchange rate is $ /£. (Round to four decimal places.) Using the Black-Scholes formula d, is, while N₁ is. (Round to four decimal places.) (Round to four decimal places.) Using the Black-Scholes formula d₂ is. while N₂ is The price of the call is $£. (Round to four decimal places.)
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