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jrede.
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jrede
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The following options are held by Frances plc at their expiry date
A call option on £500,000 in exchange for US$ at an exercise price of £1 = $1.90.The exchange rate at the expiry date is £1 = $1.95
A put option on £400,000 in exchange for Singapore $ at an exercise price of £1=$2.90
The exchange rate at the expiry date is £1 =$2.95
Which one of the following combinations (exercise/lapse) should be undertaken by the company
Call Put
A. Exercise Lapse
B. Exercise Exercise
C. Lapse Exercise
D. Lapse LapseThis question is quite confusing. I know the answer is A but I don’t understand which currency is the home country.
jrede
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