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K-Roo Ltd's US subsidiary is expecting to pay AUD 5245 in 8 months from purchasing inputs from an Australian customer. K-Roo wants to use a

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K-Roo Ltd's US subsidiary is expecting to pay AUD 5245 in 8 months from purchasing inputs from an Australian customer. K-Roo wants to use a money market hedge to lock in the USD value of the payable. It observes the following interest and exchange rates: Annualized US 8-month interest rates: 3.2%-3% Annualized Australian 8-month interest rates: 8.9%-8.7% Spot USD/AUD rates: 1.2308-1.2323 USD/AUD. What is the USD value of this payable using a money market hedge? a. 4409.0721 b. 6695.4551 c. 6807.8784 d. 6239.4137 e. 6687.0172

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