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As you probably know Treasury Wine is an Australian wine maker and sells its products in many overseas markets. Imagine that Treasury Wine is considering

As you probably know Treasury Wine is an Australian wine maker and sells its products in many overseas markets. Imagine that Treasury Wine is considering setting up a subsidiary in Germany to produce wine there to serve European consumers. The company wants to employ a matching strategy but is unable to borrow euros from a German bank. As an alternative, it can get euro-financing via either a currency swap or a parallel loan. Describe how these approaches work.

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