Plains States Manufacturing has just signed a contract to sell agricultural equipment to Boschin, a German firm, for EUR 1,250,000. The sale was made in June withpayment due six months later in December. Because this is a sizable contract for the firm and because the contract is in Euros rather than dollars, Plains States isconsidering several hedging alternatives to reduce the exchange rate risk arising from the sale. To help the firm make a hedging decision you have gathered thefollowing information. The spot exchange rate is $1.1740/euro (dollars per euro) The six month forward rate is $1.1480/euro Plains States' cost of capital is 12% per annum The Euro zone 6-month borrowing rate is 7% per annum (or 3.5% for 6 months) The Euro zone 6-month lending rate is 5% per annum (or 2.5% for 6 months) The U.S. 6-month borrowing rate is 6% per annum (or 3% for 6 months) The U.S. 6-month lending rate is 4.5% per annum (or 2.25% for 6 months) December put options for 625,000; strike price $1.18, premium price is 1.5% Plains States' forecast for 6-month spot rates is $1.19/ The budget rate, or the lowest acceptable sales price for this project, is $1,425,000 or $1.14/euro Plains States could hedge the Euro receivables in the money market. Using the information provided how much would the money market hedge return in six months assuming Plains States reinvests the proceeds at the U.S. investment rate