Exhibit 13-7
USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S)

question 21

Multiple Choice

Exhibit 13-7
USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S) $\begin{array}{|l|l|l|c|}\hline \text { Option Type } & & \text { Currency } & {\text { Canadian dollar }} \\\hline \begin{array}{l}\text { Contract } \\\text { Size }\end{array} & & 50000 &{\text { Canadian dollars }} \\\hline \text { Expiry } & & \text { April } & \mid\\\hline & & &\mid \\\hline \text { Strike } & \text { Call } & \text { Put } & \mid \\\hline \$ 0.815 & \$ 0.0118 & &\mid \\\hline \$ 0.820 & & \$ 0.0068 & \mid\\\hline\end{array}$
-Refer to Exhibit 13-7. If the spot rate at expiration is $0.80 and the call option was purchased, what is the dollar gain or loss?

• A) $123 gain
• B) $590 loss
• C) $312 gain
• D) $237 gain
• E) $0

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Definitions:

Price

The amount of money required to purchase a good or service, which can fluctuate based on supply and demand dynamics.