The Current Spot Exchange Rate Is $1

Multiple Choice

The current spot exchange rate is $1.55 = €1.00 and the three-month forward rate is $1.60 = €1.00.Consider a three-month American call option on €62,500 with a strike price of $1.50 = €1.00.If you pay an option premium of $5,000 to buy this call,at what exchange rate will you break-even?

A) $1.58 = €1.00
B) $1.62 = €1.00
C) $1.50 = €1.00
D) $1.68 = €1.00