The current stock price is 50 and the option strike price


1. An investor enters into a short forward contract on 161 thousand GBP for 1.57 USD each. How much does the investor profit if the exchange rate at the end of the contract is 1.59 USD/GBP? Note: GBP is British pounds, USD is US dollar.

2. You buy a put option on a stock for a premium of $4.82. The current stock price is $50, and the option strike price is $42. What is your break-even stock price?

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Financial Management: The current stock price is 50 and the option strike price
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