Question: Suppose the current exchange rate is $ 1.83 divided by pound, the interest rate in the United States is 5.45 %, the interest rate in

Suppose the current exchange rate is $ 1.83 divided by pound, the interest rate in the United States is 5.45 %, the interest rate in the United Kingdom is 3.77 %, and the volatility of the $/ exchange rate is 10.6 %. 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 $ 1.83 divided by pound.

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