Sterling interest rate futures contract

  You are given the following data on the 3-month sterling interest rate futures contract. The contract has a notional size of £1 million. Sterling interest rate futures contract September 2023 96.5 i. Explain what the sale of such a contract implies. ii. If you think 3-month interest rates in September 2023 will be 2% would you buy or sell the contract? Explain your reasoning and the profits you can expect if you are correct. iii. Briefly explain how a corporate Treasurer who is looking to lend £1 million of funds for 3 months from September 2023 might use the above contract to hedge interest rate risk.