One year ago, you bought a put option on 200,000 euros with an expiration date of...

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One year ago, you bought a put option on 200,000 euros with anexpiration date of one year. You paid a premium on the put optionof $.05 per unit. The exercise price was $1.32. Assume that oneyear ago, the spot rate of the euro was $1.29, the one-year forwardrate exhibited a discount of 3%, and the one-year futures price wasthe same as the one-year forward rate. From one year ago to today,the euro depreciated against the dollar by 4%. Today the put optionwill be exercised (if it is feasible for the buyer to do so).
a. Determine the total dollar amount of your profit or loss fromyour position in the put option.
b. Now assume that instead of taking a position in the putoption one year ago, you sold a futures contract on 200,000 euroswith a settlement date of one year. Determine the total dollaramount of your profit or loss.

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One year ago, you bought a put option on 200,000 euros with anexpiration date of one year. You paid a premium on the put optionof $.05 per unit. The exercise price was $1.32. Assume that oneyear ago, the spot rate of the euro was $1.29, the one-year forwardrate exhibited a discount of 3%, and the one-year futures price wasthe same as the one-year forward rate. From one year ago to today,the euro depreciated against the dollar by 4%. Today the put optionwill be exercised (if it is feasible for the buyer to do so).a. Determine the total dollar amount of your profit or loss fromyour position in the put option.b. Now assume that instead of taking a position in the putoption one year ago, you sold a futures contract on 200,000 euroswith a settlement date of one year. Determine the total dollaramount of your profit or loss.