For the Following Problem(s), Please Include a Copy of the Cumulative

question 15

Multiple Choice

For the following problem(s) , please include a copy of the cumulative standard normal tables.
-Suppose the current exchange rate is $1.42/€,the interest rate in the United States is 4.0%,the interest rate in the EU is 6%,and the volatility of the $/€ exchange rate is 20%.Using the Black-Scholes formula,the price of a three-month European call option on the Euro with a strike price of $1.45/€ will be closest to:

• A)$0.040/€.
• B)$0.059/€.
• C)$0.078/€.
• D)$0.097/€.