Kerry Howell Plc, a UK firm, plans to use a money market hedge to hedge its payment of A$3,000,000 (Australian dollars) for Australian goods in 1 year. The UK interest rate is 7%, while the Australian interest rate is 12%. The spot rate of the Australian dollar is £0.45, while the 1-year forward rate is £0.44. Determine the amount of British pounds needed in 1 year if a money market hedge is used. (15% mark)
