Virgin Atlantic has ordered a dream liner from bowing at a cost of 20,000,000.00 pounds to be delivered in one year. Boeing operates in the United States while virgin Atlantics home is at Heathrow Airport in London. The spot rate is $1.40/ pounds while the 12-month forward rate is $1.48/pounds. Boeing purchased a put option with an exercise price of $1.45/pounds and a one-year expiration. Assume that the option premium was $0.02 per pound a. If the spot rate ends up being $1.32 on the expiration date, will it exercise the option and if it did how much would be Boeings gain or loss. If it did not exercise the option how much would Boeing lose, b. If instead of purchasing an option contract, Boeing purchased a forward contract, what would be Boeings gain/loss? What position would you recommend that Boeing take? (purchase an option contract or forward contract) and why?