Sky Ltd, located in United Kingdom, is going to hedge a $5 million payment due in 5 months. The trader has gathered the following information regarding possible hedges against currency risk. So: $1.3835 - 1.3855/ S5months $1.4328 - $1.4408/ 5mth Forward: 0.56 -0.68c/ discount Borrowing rates (pa): US 7%, UK 6.25% Deposit rates (pa): US 4.5%, UK 3.75% Opening Futures Price: $1.3810/ (Contract size = 62,500) Closing Futures Price: $1.3848/ c) What type of hedge would you recommend to the company? Consider forward contract, money market and futures contract, and show all calculations. (21 marks)