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Compute net pro?t or loss

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Assume that you are a speculator who sells (i.e., writes) a put option on the pound (GBP) for a premium of $0.05 per unit, with an exercise price of $1.40. The GBP option represents 100,000 units and the option will not be exercised until the expiration date, if at all. If the GBP spot rate is $1.36 on the expiration date, compute your net pro?t or loss.

Reference no: EM133068799

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