3. AMERI-Corp. will receive 5,000,000 Pound (P) in 270 days (75) from a Turopean customer. AMERE Corbis concerned about exchange rate risk on the future uss value of this receivable and wants to compare a Money Market or Option hede Spot rate today is 51.30/P ANNUAL deposit (investing rate : Europe - 40%: USA = 2,4% ANNUAL borrowing rate ist Europe 5.0% USA = 3.6% A CALL option is available with 270 days to maturity with a strike price of $1.31/ P with a premium of $.015/P A PUT option is available with 270 days to maturity with a strike ptice of 1305/P with a premium of 6.022 /P AMERI-Corp forecasted the *270-day future expected Spot Hate as follows: $1.285/P 15% prob. $1.295/P 30% prob. $1.310/P 40% prob. $1.325 / P 15% prob QUES. 3-A-B-C Estimate the amounts that AMERI-Corp can expect by hedging among: s 3-A 10pts MONEY MARKET hedge equivalent amount 3-B) ) Money Market Option % 7pts 4. What is the effective annual interest rate on NewCo's 3-yr $15.0 million debt issue in the USA at LIBOR + 2? Upfront origination fee = 2.0%, if LIBOR stays steady at 3.0% for all 3 years of floating rate loan? Interest paid annually at yr-end. T= 1 Loan Cash Flow T= 2 Loan Cash Flow T= 0 Loan Cash Flow T= 3 Loan Cash Flow