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QUESTION
week 1 written
Recently currency options are the new popular form of hedging. Use the Internet to locate a currency options calculator. Use the information in the chart below and calculate a currency option.
DetailAmountDomestic CurrencyUSDForeign CurrencyEUROption TypeCallInterest Rate5%Spot price$1.57 centsSpot Date6/12/2012Principle200,000Strike PriceCreate this priceExpiration Date7/12/2012Volatility2%Research on the Internet and the Rasmussen research databases and write a 1 to 2 page paper that:
- Explains the option you calculated.
- Describes how hedging can be of advantage or disadvantage to the option.
- Use APA formatting for any citations and reference page.
