You are the treasurer for ABC corporation. You just received a bill from your Italian supplier of Genoa salami for Eur 500,000. The Euros are due in three months.

1- What would you do to hedge this exposure? ( What hedge would you put on)

2- If you hedged the underlying position properly, what would you expect the net gain or loss to be when you combine the underlying position with the hedge mark-to-market?