## How R can help a lot

We start this chapter by showing some examples for exotic options, giving one possible classification. We will show examples from the `fExoticOptions`

package and how the so-called Black-Scholes surface can be created for any derivative-pricing function. Afterwards, we will focus on the numerical estimation of the Greeks of any exotic derivative. Next, we will show the pricing of an exotic option that is not yet included in the `fExoticOptions`

package.

We have chosen the **Double-no-touch (DNT)** binary option mainly because of its popularity on the foreign exchange (**FX**) markets and the many conclusions that are relevant even for other exotics. We will use AUDUSD as underlying because at the time of writing this chapter, there is a significant interest differential between the AUD and the USD interest rates, and we can show how to put these rates into the pricing functions. We will show a second way of calculating the price of a DNT by using static option replication arguments...