Question: U.S. Dollar/Euro. The table, , indicates that a 1-year call option on euros at a strike rate of $1.2501/ will cost the buyer $0.0476 /

 U.S. Dollar/Euro. The table, , indicates that a 1-year call option

on euros at a strike rate of $1.2501/ will cost the buyer

U.S. Dollar/Euro. The table, , indicates that a 1-year call option on euros at a strike rate of $1.2501/ will cost the buyer $0.0476 / , or 3.80%. But that assumed a volatility of 10.500% when the spot rate was $1.2512 / . What would the same call option cost if the volatility reduced to 10.500% when the spot rate fell to $1.2477/? The same call option cost if the volatility was reduced to 10.500% when the spot rate fell to $1.2477/ would be $ I. (Round to four decimal places.) U.S. Dollar/Euro. The table, , indicates that a 1-year call option on euros at a strike rate of $1.2501/ will cost the buyer $0.0476 / , or 3.80%. But that assumed a volatility of 10.500% when the spot rate was $1.2512 / . What would the same call option cost if the volatility reduced to 10.500% when the spot rate fell to $1.2477/? The same call option cost if the volatility was reduced to 10.500% when the spot rate fell to $1.2477/ would be $ I. (Round to four decimal places.)

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