Hedging Decision on Receivables. Assume the following information: 180 day U.S. interest rate = 8% 180 day British interest rate = 9% 180 day forward rate of British pound = $1.50 Spot rate of British pound = $1.48 Assume that Riverside Corp. from the United States will receive 400,000 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.

		$500,000 (forward hedge), $489,337 (money market hedge); the corporation should use a forward hedge
		$540,000(forward hedge), $586,578 (money market hedge); the corporation should use a money market hedge
		$600,000 (forward hedge), $586,569 (money market hedge); the corporation should use a forward hedge
		$640,000 (forward hedge), $681,780 (money market hedge); the corporation should use a money market hedge