2. Use the payoff diagram and map out: a) F Mayer's exposure given budget rate of AUD/EUR 0.69 According to the information from case study, F Mayer had imported commodity worth euro 70 million annually. That is, the exposure of F Mayer is around euro 70 million b) FEC at AUD/EUR 0.6910 The case study mentioned that F Mayer needed to pay for imports worth euro 70 million and it had a four months FEC with the forward exchange rate for AUD/ EUR is 0.6910. Therefore, after 4 months, F Mayer can pay about AUD 101302460.203 resulted from 70000000 divided by 0.6910 for exchanging euro 70 million. c) All the options, zero collar and knock-in option d) The payoff after applying the hedging strategies