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Vinay • 28.75K Points
Instructor II 

Q. A UK corporation has purchased currency call options to hedge a 70,000 dollar payable. The premium is £0.015 and the exercise price of the option is £0.54. If the spot rate at the time of maturity is £0.59, what is the total amount paid by the corporation if it acts rationally?

(A) £36,750
(B) £1,050
(C) £37,800
(D) £38,850
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