A us corporation has bought currency call options to hedge, Ask an Expert

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A U.S. corporation has bought currency call options to hedge 70,000 pound payable. The premium is 2 cents for each GBP and the exercise price of option is 1.6500 (USD per 1 GBP). If the spot rate at the time of maturity is 1.7100 USD per GBP, what is the net profit the company gets from the option hedge?

$3,600.

$4,900

$2,800

$1,400

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