THIS IS FOR INTERNATIONAL FINANCE, PLEASE ANSWER THE QUESTIONS AND THE CALCULATIONS WITH FULL EXPLANATIONS! THANK YOU SO MUCH!

Answer all parts of the question hestion 1: Coca Cola (KO) and Pepsi have continually been hedging their foreign currency carnings, While hey manufecture in Europe, significant sales are coming from notr-curo currency markets. How they hedge differ, however, dramatically, While Coca Cola (KO) hodged to protect earnings, Pepsi have sometimes generated a significant proportion their camings from their hedges. As the recent graduate from CUD, the CFO of Coca Cola (KO) assigns you the important task of analyzing the different types of risk faced by the multinational, particularly, for European deals. The following transactions are of particular interest to the CFO: - The Coca Cola (KO) parent company in the U.S, has sold inventory in Spain for E18,000,000 payable in 45 days. Gurrent spot rate $0.8375/ 45 -day forward rate $0.8325/ Coca Cols (KO)'s parent cost of espital is 14.0% US 45 day borrowing rate is 7.0% p.a. US 45 day investing rate is 5.0% p.a. US 180 day borrowing rate is 6.0% p.a. US 180 day investing rate is 5.5% p.a. Spain 45 day borrowing rate is 20.0%pa. Spain 45 day investing rate is 8.0% p.a. Spain 180 day borrowing rate is 9.0% p.a. Spain 180 day investing rate is 11.5% p.a. Your team of legendary financial analysts expect future spot rate in 45 days to be 50.7810/. (a) Provide 3 possible scenarios which can give rise to transaction exposure? (b) Evaluate the pros and cons of hedging as a risk management tool. Give an example of each. (c) Based on the above information, analyse the impact of - Remaining unhedged - Forward hedging - Money market hedging (d) If you want to hedge the risk by either using a forward or a money hedge, which hedging technique would you recommend to the CFO? Part of your analysis should include the break-even rate, Explain your