You purchase a 6-month call option on euro for a premium of


You purchase a 6-month call option on euro for a premium of $0.05 per unit, with an exercise price of $1.16; the option will not be exercised until the expiration date, if at all. You borrowed the money for the premium at 8% continuous compounding rate. if the euro's market price. If the euro's market price on the exportations date (t = 6/12) is $1.36, how much is your net profit/loss per unit in dollars and Euros? Please also use a graph.

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Financial Management: You purchase a 6-month call option on euro for a premium of
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