Suppose it is end of November $2007,$ and Porsche reviews its hedging strategy for th cash flows it

expects to obtain from vehicle sales in North American during the calendar year $2009.$ Assume that

Porsche entertains three scenarios: $(1)$ The expected volume of North American sales in $2009$ is

$32,750$ vehicles. $(2)$ The low$-$sales scenario is $30\%$ lower than the expected sales volume. $(3)$ The

high$-$sales scenario is $30\%$ higher than expected sales volume. Assume, in each scenario, that the

average sales price per vehicle is $$90,000$ and that all sales are realized at the end of November

All variable costs incurred by producing and shipping an additional vehicle to be sold in

North America in $2009$ are billed in Euros and amount to $60,000$ per vehicle. Characterize how

Porsche's Euro cash flows, net of variable costs, obtained from its North American sales depend on

the spot exchange rate that prevails at the end of November if:

a$.$ Porsche does not hedge its currency exposure at all

b$.$ Porsche hedges by selling forward US$ equal to the amount of expected $2009$ sales with

a two$-$year forward contract

Solution to part b is available but I need to understand the undelying calculations how those numbers were arrived at$.$