Assuming that the spot rate in 90 days is 075 what is the


Cane Corporation will need 201,000 Canadian dollars (C$) in 90 days to cover a payable position. Currently, a 90-day call option with an exercise price of $.75 and a premium of $.01 is available. Also, a 90-day put option with an exercise price of $.73 and a premium of $.01 is available. Cane plans to purchase options to hedge its payable position. Assuming that the spot rate in 90 days is $0.75, what is the net amount paid, assuming Cane wishes to minimize its cost?

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Finance Basics: Assuming that the spot rate in 90 days is 075 what is the
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