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Assume the following information to calculate the dollar cost of using a money market hedge to hedge 200,000 pounds of payables due in 180 days.

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Assume the following information to calculate the dollar cost of using a money market hedge to hedge 200,000 pounds of payables due in 180 days. Assume the firm has no excess cash. Assume the spot rate of the pound is $2.02, the 180-day forward rate is $2.00. The British interest rate is 5%, and the U.S. interest rate is 4% over the 180-day period. a. $391,210 b. $396,190 c. $388,210 d. $378,119

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