1. (20 points) Hong Kong Dollar Funding. Cash markets vs. Synthetic. On December 31st, 2018, you are asked to borrow HK$1 billion for 1 year for your institution. You must decide whether to fund this in the cash Hong Kong interbank market or synthetically in the US dollar LIBOR market. Spot 12-month Foreign Rate Forward Points Exchange Market 7.8322 -565 Annualized Interest Rates % 3-month 12-month HIBOR Rates 2.32679 2.74714 USD LIBOR Rates 2.61375 3.00544 a. Use the above chart to calculate the forward rate 12 months in the future, Fil