John Deere's Chinese Acquisition: On January $15,2017,$ the US farming equipment giant won approval from the Chinese authorities for the acquisition of Shen$-$Zhen Excavators, Ltd$.-$ a medium sized Chinese manufacturer of small earth moving equipment $-$ for Yuan $($CNY$)750$ million with payment due in $6$ months. On that day the $6$ month forward rate was CNY $6\mathrm{.}5=$ US$$1.$ Interest rates in CNY and US$ were respectively $10\%$ and $4\%$ on an annual basis. The spot exchange rate on January $15,2017$ is CNY $6\mathrm{.}25=$ $$1.$

$1.)$ What was the nature of John Deere's currency exposure? Identify John Deere's alternative hedging options.

$2.)$ Sketch graphically each optioon. Identify your axes and comment on each intersection point.