1. A call option to buy £10,000 at a strike price of $1.80 = £1.00 is equivalent to

a. A put option on £10,000 at a strike price of $1.80 = £1.00.

b. A call option on $18,000 at a strike price of $1.80 = £1.00

c. A put option on $18,000 at a strike price of $1.80 = £1.00.

d. None of the above

2. Consider a trader who takes a long position in a six-month futures contract on the euro. The forward rate is $1.75 = €1.00; the contract size is €62,500. At the maturity of the contract the spot exchange rate is $1.65 = €1.00.

a. The trader has lost $625.

b. The trader has lost $6,250.

c. The trader has made $6,250.

d. The trader has lost $66,287.88