Using the data for the problem, assume that you entered into an option with Goldman Sachs for one contract worth £75,000 at a premium of $.0325, a strike price of 155 and a brokerage fee of $25 to get into the option and also to exercise the option. Would you exercise the option?
A) yes.
B) no
C) It depends on the June 1 spot rate.
D) This is not an appropriate situation for an option.
Correct Answer:
Verified
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