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6. (6 pts) Forward versus Money Market Hedge on Receivables. Assume the following information: 180 -day U.S. interest rate =1.5% per 180 days or 3%

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6. (6 pts) Forward versus Money Market Hedge on Receivables. Assume the following information: 180 -day U.S. interest rate =1.5% per 180 days or 3% per year compounded semi-annually 180 -day British interest rate =1% per 180 days or 2% per year compounded semi-annually 180-day forward rate of British pound =$1.32 Spot rate of British pound =$1.33 Assume that Riverside Corp. from the United States will receive 200,000 pounds in 180 days. Would it be better off using a forward hedge or a money market hedge? Substantiate your answer with estimated revenue for each type of hedge

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