Specify exactly what your exposure is and list the hedging alternatives you should consider.

Show how each of these hedging alternatives can be achieved.

II$.$ Assume the following probability distribution for the euro spot rate at the end of three months. Analyze the option versus the no$-$hedge alternatives and decide which alternative is probably the better one of the two and why.

$\backslash$table$[[S_1,$Probability$],[,35\%$