Use theblack-scholes formula to determine the price of a


Suppose the current exchange rate is 1.78/£?, the interest rate in the United States is 5.04%?, the interest rate in the United Kingdom is 3.91%?, and the volatility of the? $/£ exchange rate is 9.1%. Use the?Black-Scholes formula to determine the price of a? six-month European call option on the British pound with a strike price of 1.78/£.

The corresponding forward exchange rate is $ ______£. (Round to four decimal? places.)

The price of the call is? $___________

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Financial Management: Use theblack-scholes formula to determine the price of a
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