Your U.S. company has USD $3,000,000 to be invested for the next 270 days. Using only the data given below, answer the following questions. (a and b).

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U.S. interest rate (annual): 4.02%

Australian interest rate (annual): 4.02%

Spot rate: 1 USD = 1.55775 Australian Dollar (AUD)

270 day forward rate: 1 USD = 1.54600 Australian Dollar (AUD)

Your forecast of the spot rate in 270 days:

1 USD = 1.56805 Australian Dollar (AUD)

a.) 15 points

In which country would you invest the $3,000,000 if you had the ability to use the forward market? (7.5 points)

What total amount (in USD) would you obtain at the end of 270 days? (7.5 points) Show the necessary calculations.

b.) 15 points

In which country would you invest the $3,000,000 if you had 100% certainty that your forecast would come true? (7.5 points)

What total amount (in USD) would you obtain at the end of 270 days? (7.5 points) Show the necessary calculations.