We have 10 million South African rand that is payable in one year ( we have to pay it to a South African company.) Assume the spot exchange rate is 10.02 rand equal one US dollar. Also, assume that the forward exchange rate is 10 rand equal one dollar. Furthermore either calls or puts cost .01(1%). Expound on how to hedge the aforementioned exposure. Moreover, the market expectation is that the rand will depreciate against the dollar. Ascertain that we use a forward contract, or an options approach, or risk sharing, or leading and lagging for transactions exposure.