You are selling mopeds to China. The importer owes you Yuan 10,000,000, the amount is due in 90 days. If the currency exchange rates and interest rates are as follows (see Data Table #2), what is your hedging decision? You have to explore each Accounts Recievable (AR) hedging alternative (by answering questions below) and choose the best one.

Amount (to be received in Yuan)	10,000,000
Days	90
Spot rate (Yuan/$)	6.4285
Forward premium (+) or discount (-) on Yuan	-4.00%
Expected FX rate in 90 days (Yuan/$)	6.4771
CALL Option Premium	2%
PUT Option Premium	4%
CALL Strike Price (Yuan/$)	6.8200
PUT Strike Price (Yuan/$)	6.8200
US borrowing rate	6%
US investing rate	4%
Chinese borrowing rate	9%
Chinese investing rate	7%
Cost of Capital (WACC)	14%

1. If you decide to remain unhedged, compute the amount you will collect in 90 days in USD.

2. If you hedge AR in the forward market, how much will you collect in 90 days in USD.

3. If you decide to hedge AR in the money market, how much will you have to borrow today in Yuan?

4. If you decide to hedge AR in the money market, how much USD will you have available to you today from the loan in previous question?

5. Find the total proceeds of the money market hedge in 90 days in USD. (Round your answer to 2 decimals).

6. What option will you use to hedge AR? Put option or Call potion ?

7. Compute the option premium in USD today, if you decide to hedge AR using options. (Round your answer to 2 decimals).

8. Carry the option premium 90 days forward. (Round your answer to 2 decimals).

9. If you decide to exercise the option, how much USD you will receive at strike price in 90 days? (Round your answer to 2 decimals).

10. Compute the total proceeds of the option hedge in 90 days in USD, if you decide to execute the option. (To calculate total proceeds, you need to account for the option's cost in 90 days). (Round your answer to 2 decimals.)