Tesla, Inc. sells its 2022 automobiles to Euro Zone at a price of €20 million. These U.S. cars will be delivered and pai

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Tesla, Inc. sells its 2022 automobiles to Euro Zone at a price
of €20 million. These U.S. cars will be delivered and paid in 2023
(exactly one year later). Related financial info below (for both
forward and money markets): 1) Euro loan yearly interest rate: r* =
4% 2) U.S. yearly interest rate: r = 3% 3) Current spot exchange
rate: $1.2154 per € 4) 1-year expected spot exchange rate: $1.1953
per € a. If Tesla decides to hedge its financial/exchange risks by
using forward contract, estimate to forward exchange rate (one year
later). (1 point) b. Based on Part a., should Tesla hedge using
Forward or Money market to maximize its company’s revenue? Explain
and show your calculation. (3 points)