PepsiCo has currency exposure as a result of its international business. Suppose over the next 3 months in India, PepsiCo faces both costs from its operations in India, and it also expects to receive Indian Rupee from its sales with India. In Europe over the next three months, PepsiCo faces costs from recent investments in Spain, and it also expects revenues from the sale of its products in Spain. Assume today is November 1, 2020, and suppose PepsiCo is projecting the following Indian Rupee (INR) and Euro (EUR) costs and revenues (after-tax cash flows) will occur three months from November 1, 2020 so that the receivables & payables will be coming due on February 1, 2021:

Projections for PepsiCo: PepsiCos FX Inflows and FX Outflows

Country Outflows on Feb.1,2021 Inflows on Feb.1, 2021

Euro Area euro 124.40 million Euro 121.75 million

India INR 192 million INR 225 million

Assume the company is concerned about the net exposure in each of these currencies when payables and receivables fall near the same date.