blank 1 options: 228,571.43 190,476.19 209,523.81 247,619.05

blank 2 options: $179,809.52 $224,761.90 $157,333.33 $202,285.71

blank 3 options: $194,194.28 $218,468.57 $169,920.00 $242,742.85

4. Money market hedge versus forward hedge on receivables 1. 2. 3. STEP: 2 of 3 After calculating its dollar inflow of forward hedging, Goodwin is now considering a money market hedge of the 200,000 pound receivable. In particular, Goodwin can borrow pounds at a rate of 5.00% over the next year. Suppose that the spot rate for the pound today is $1.18. In order to be able to pay off the loan exactly with 200,000 euros in one year, Goodwin would only need to borrow approximately pounds. If it takes these borrowed pounds and exchanges them for dollars, assuming a spot rate for the pound of $1.18, Goodwin would have approximately Assume that Goodwin Co. can earn a rate of 8.00% on dollars invested over the next year. If Goodwin invests these dollars that it received from converting the borrowed pounds, in one year it will have approximately Grace Step 2 TOTAL SCORE: 114 (to complete this step and unlock the next step)