For the currency options how do we choose the exercise price 1.60 or 1.62 must we do both in exam?? current spot is 1.5996 both of this exercise price is better than spot rate?
Ask the Tutor ACCA AFM
June 2013 Q3
12y ago#1Ideally, you should show what happens for all the exercise prices available.
However, given the time pressure, make sure that you do show for one exercise price properly and you will get more than half marks for that part of the question. Do more if you find that you have the time.
The current spot is not relevant in choosing the exercise price.
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