Suppose that: Today’s spot $/£ rate is $1.3124/£. The U.S. 1-year bond rate is 1.43%. The U.K. 1- year bond rate is .44%

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Suppose that: Today’s spot $/£ rate is $1.3124/£. The U.S.
1-year bond rate is 1.43%. The U.K. 1-
year bond rate is .44%.
a. You have found a future (cash-settled) for a pound (£)
denominated in dollars. What
should be the contract price? You can round this to 2 decimal
places.
b. In one year, the spot rate will take some value. For every
possible future spot rate from
1 to 1.6 in increments of .01 (i.e. for 1, 1.01, 1.02, etc.),
calculate the profit of one of
these futures contracts from the long side and one of these futures
contracts from the
short side. Present this information graphically. [I’m asking you
to make the payoff
graph where the x-axis ranges from 1 to 1.6].
c. What is the current £/$ spot rate (according to the data above,
not in real life)?
d. You have found a future (cash-settled) for a dollar denominated
in pounds (£). What
should be the contract price?
e. In one year, the spot rate will take some value. For every
possible future spot rate from
£.6/$ to £1/$ in increments of .01, calculate the profit of one of
these futures contracts
from the long side and one of these futures contracts from the
short side. Present this
information graphically.