Assume That Smith Plc Will Need to Purchase $200,000 in 90

question 1

Multiple Choice

Assume that Smith plc will need to purchase $200,000 in 90 days. A call option exists on dollars with an exercise price of £0.54, a 90-day expiration date, and a premium of £0.04. A put option exists on dollars, with an exercise price of £0.54, a 90-day expiration date, and a premium of £0.03. Smith plc plans to purchase options to cover its future payables. It will exercise the option in 90 days (if at all) . It expects the spot rate of the pound to be £0.57 in 90 days. Determine the amount of pounds it will pay for the payables, including the amount paid for the option premium.

• A) £116,000
• B) £114,000
• C) £108,000
• D) £102,000
• E) £100,000

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A steroid hormone primarily produced in males by the testes and, in small amounts, in females by the ovaries, playing key roles in health and sexual development.

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The action of coming to live permanently in a foreign country, often resulting in demographic, economic, and cultural changes within the host society.

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The movement of people from one place to another, which could be within or across national borders, often for reasons such as seeking better economic opportunities or escaping conflict.

Internal Migration

The movement of people within a country from one region or place to another, often for work or living conditions.