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Sir I am having hard time in finding out about how exactly do we choose exercise price for options? Currency options to be precise..
Also, please explain the way we get the exercise price right for interest rate options.
Unless the questions states a specific objective (i.e. a maximum or minimum exchange rate / interest rate to aim for) then ideally you should calculate for all the exercise prices available and then discuss.
However most of the marks are gained by proving that you know how options work, and so if you are short of time then just pick any one of the exercise prices available.
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