3. On 14 September 2020, a company entered into a forward contract with a bank to sell EUR 1000 for USD 1200 in 3 months (on 14 December 2020). (a) The EURUSD exchange rate on 14 December 2020 proves to be S0 = 1.3 (USD per EUR), with USD and EUR interest rates flat at r = 3% and rf = 1% respectively. What is the profit or loss for the company in USD (on 14 December 2020)? (b) Rather than settling the contract on 14 December 2020, the company instead asks the bank if it can roll the contract forward three more months. The bank agrees to a new delivery exchange rate, K, so that the company will sell EUR 1000 for USD 1000 K on 14 March 2021. Calculate the value of K. Explain how it is determined (on 14 December 2020)