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CTP · Question #525
CTP Question #525: Real Exam Question with Answer & Explanation
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Question
- (Topic 6) A U.S. company that is expecting to receive a payment of C$1,000,000 purchased a put option of C$1,000,000 at a strike price of 1.75 C$/US$. Two days before the receipt of the payment, the spot rate is 1.85 C$/US$. To maximize its receipt of dollars, the company should do which of the following?
Options
- BExercise its put option.
- CPurchase a call option at 1.85.
- DPurchase a spot contract at 1.85.
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