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1.4. Explain carefully the difference between selling a call option and buying a put option. 1.5. An investor enters into a short forward contract to sell Indian 100,000 for US dollars at an exchange rate of 40.25 per U.S. dollar. How much does the investor gain or lose if the exchange rate at the end of the contract is (a) 40.12 and (b) 40.35? 1.6. A trader enters into a short cotton futures contract when the futures price is 50 cents per two pound. The contract is for the delivery of 50,000 pounds. How much does the trader Groru gain or lose if the cotton price at the end of the contract is (a) 48.20 cents per pound RSVIET and (b) 51.30 cents per pound? il 192-3 hs a symm ODETI CESvils

1.4. Explain carefully the difference between selling a call option and buying a put option. 1.5. An investor enters into a short forward contract to sell Indian 100,000 for US dollars at an exchange rate of 40.25 per U.S, dollar. How much does the investor gain or lose if the exchange rate at the end of the contract is (a) 40.12 and (b) 40.35 ? 1.6. A trader enters into a short cotton futures contract when the futures price is 50 cents per pound. The contract is for the delivery of 50,000 pounds. How much does the trader gain or lose if the cotton price at the end of the contract is (a) 48.20 cents per pound and (b) 51.30 cents per pound? 4. Explain carefully the difference between selling a call option and buying a put option. .5. An investor enters into a short forward contract to sell Indian 100,000 for US dollars at an exchange rate of 40.25 per U.S. dollar. How much does the investor gain or lose if the exchange rate at the end of the contract is (a) 40.12 and (b) 40.35

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