Premium for a european call for gbp

Assignment Help Finance Basics
Reference no: EM132466823

On the market, the premium for a European call for GBP (British pounds) with expiration of 4 months and exercise price of $1.4 /GBP is $14. The underlying value of the currency is $ 1.33 /GBP. How_much_is the value of a put, using put-call parity, if the U.S. risk free rate is 1.8% and the British is 1.5%?

Reference no: EM132466823

Questions Cloud

Calculate ruben estimated living expenses for the next : Calculate Ruben's estimated living expenses for the next two years using the following:
Describe issues profiled by trend that have matters of faith : Discuss the ways in which at least one identity you claim has become important to your sense of belonging (or lack thereof) in some aspect of your life.
How large will the last deposit be : How large will the last deposit be? Round your answer to the nearest cent.
Write an explanation of the psychometric properties : Write an explanation of the psychometric properties of the assessment tool you were assigned. Explain when it is appropriate to use this assessment tool.
Premium for a european call for gbp : On the market, the premium for a European call for GBP (British pounds) with expiration of 4 months and exercise price of $1.4 /GBP is $14.
Spot market and futures-forward markets : What are differences between spot market and futures / forward markets?
What would happen to the bid-ask spread : When a currency has a very low trading volume or has volatile movement in prices, what would happen to the bid-ask spread?
Define how each research type differs from the others : Provide an example of experimental, quasi-experimental, and nonexperimental research from the GCU Library and explain how each research type differs from the.
Nominal exchange rate and real exchange rate : What are differences between nominal exchange rate and real exchange rate?

Reviews

Write a Review

Finance Basics Questions & Answers

  Does this suggest that the mean weight is too low

A frozen-food packer specifies the mean weight of a product as 200 g. The output is Normally distributed with a standard deviation of 15 g. A random sample of 20 has a mean of 195 g. Does this suggest that the mean weight is too low?

  Computation of currency positions against dollar

On December 31, 2001 Historic Bank had long positions of 200,000,000 Japanese Yen and 50,000,000 Swiss Francs. The closing exchange rates were ¥92/$ and Swf1.89/$.

  Find the assets book value at the time of liquidation

An asset used in a 4-year project falls in the 5-year MACRS class for tax purposes. The asset has an acquisition cost of $500,000 and will be sold for $100,000 at the end of the project. Assume tax rate is 35%. (A) Find the asset's book value at the ..

  Average weight of outgoing orders

Zappos thinks that the average weight of outgoing orders is less than 6 pounds. A sample of 25 packages are weighed and found to weigh 5.95 pounds with a standard deviation of 0.6. Use hypothesis testing at the 5% level and select the best answer

  Why do companies split their stock

Prepare the journal entries for Options 1 and 2, and comment on why these alternatives may not be attractive. Why do companies issue stock dividends?

  What is the best criterion to evaluate a project

What is the best criterion to evaluate a project, and why? What other methods are used to evaluate project worthiness and how is the best criterion better than

  Percent confidence interval for the percentage

In each of 4 years a random sample of 100 voters (different each year) are asked if they support a political party. The numbers each year who support the party are 41, 32, 35, and 33. (a) Give a 95 percent confidence interval for the percentage w..

  What would the average nominal interest rate

what would the average nominal interest rate on a five-year Treasury bond have to be? (b) what would the average nominal rate have to be for a 10-year Treasury bond with the same characteristics?

  Expectations about corporate governance reform

Expectations about corporate governance reform need to be managed. Good corporate governance is not an insurance policy against fraud.

  What is the customer profit

The customer places 70 orders, orders 24 unique items, 940 total items, and makes 7 returns. What is the customer profit (loss)? $509.80 $7,490.20 $1,800 $1,290.20

  Define strategic planning

How would you explain strategic planning? What are the differences between strategic and financial planning? What financial problems may an organization face when implementing their strategic plan?

  Make from the mortgage

After 5 years, market interest rate goes up to 6.5%. How much money will you make from the mortgage for the next 25 years and the market rate remains at 6.5%?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd