Assume the following information:

180 day U.S. interest rate 3%

180 day British interest rate 4%

180 Day Forward rate of British pound $1.50

Spot rate of British pound $1.49

Assume that Riverside Corp. from the U.S., will receive 400,000 British pounds in 180 days. Would it be better off using a forward hedge or a money market hedge? (SHOW ALL WORK)

a. Revenue using Forward Hedge: __________

b. Revenue using money market hedge: _________