1. You purchased a call option contract on Brazilian real with an exercise price of $.30/BRL at an option premium of $.0034. The option contract size is 40,000 BRL. What is your net gain or loss on this investment if the exchange rate is $.336/BRL on the option expiration date?
A) -$1,576
B) -$136
C) $1304
D) $1440
E) $1576
2. The Central Bank practice of the active buying and selling of the domestic currency against foreign currencies is the process of .....
A) direct intervention
B) indirect intervention
C) coordinated intervention
D) capital controls