Your firm is a U.K.-based IM of bicycles. Spanish bicvcles. AS AN IMPORTER, YOU ARE BUYING BICYCLES AND PAYING IN EURO You have placed an order with a Spanish supplier for 500,000 worth of bicycles. Payment (in euro) is due in 3 (three) months. Your firm wants to hedge the payable into pounds Country U.S. S Equivalent Bid $1.20000 $1.22500 $1.25000 $1.27500 $1.30000 $1.03000 $1.04000 S1.05000 $1.06000 $1.07000 Ask $1.20100 $1.22600 $1.25100 $1.27600 $1.30100 $1.03100 $1.04100 $1.05100 $1.05200 $1.05300 Britain (Pound) 1 Month Forward 3 Months Forward 6 Months Forward 12 Months Forward I Interest (lend%-borrow %) 2.00%..4.00% 1.00%..2.00% euro 1 Month Forward 3 Months Forward 6 Months Forward 12 Months Forward a) Detail a strategy using forward contracts that will hedge your exchange rate risk INTO BRITISH POUNDS. You must clearly state what amount of which currency you are selling or buying at what price. Give me the trading orders (10 points) Write your answer here. b) Estimate the receipt in pounds in 6 months of the strategy that you offered in part a) (10 points) c) Outline a strategy using spot exchange rates and borrowing or lending that that will hedge your exchange rate risk. Your answer does not require numbers, it requires a sentence (10 points) Write your answer here