Determine the future spot price

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A speculator is considering the purchase of two three-month British pound call options with a striking price of $1.59 per £. The premium is $0.03 per pound. The standard size of each option contract is 10,000 pounds.

Question 1: Determine the future spot price at which the speculator will only break even

Question 1: What would be the speculator's profit if the pound depreciates to $1.57 per £?

Reference no: EM132508500

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