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Hedging with Forwards OriginalBuy EUR FWD 1,800 1,000 in 1/2 Years EUR USD) Receive 1,500 (T o convert to 1,200 Forward Contrac Rate EUR US

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Hedging with Forwards OriginalBuy EUR FWD 1,800 1,000 in 1/2 Years EUR USD) Receive 1,500 (T o convert to 1,200 Forward Contrac Rate EUR US 1.32 (this is the number of USD per 1 unit of EUR) 900 EURUSD Payoff Table: Fill in the table below and analyze the graphs on the right OriginalSell EUR FWD Notional Amount = Original Position 1,800 Net Payoff in USD OriOriginal Buy EUR Sell EUR 1,500 Original Position Position Position EUR/USD in 1/2 EUR Buy EUR Sell EUR Receivable) Forward Forward 1,200 Forward Forward 900 1.10 1.12 1.13 1.14 1.15 1.16 1.17 EURUSD

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