your example USG ancial market neage instruments (e.g., buy a forward contract, sell a put option). 2. Please provide an original example of a business with operating exposure and describe three ways to manage the exposure from your example. 3. Please provide an example that describes a subsidiary that uses the local currency as the functional currency and one that accounting rules require the use of the reporting currency as the functional currency according to FASB 52. 4. Cydefex, a large US pharmaceutical company with no international operations, is considering raising long term debt financing in international capital markets. The company is receptive to raising the funds in currencies other than USD and has asked you for advice. . Please provide two reasons in favor of issuing debt in international markets. List the information necessary to compare issuing debt in the US domestic bond market, issuing USD denominated debt issued outside the US, and issuing foreign currency denominated debt. 5. If Cydefex elects to issue EUR denominated bonds explain the transactions the company could use to hedge the foreign exchange risk 6. Since you gave such excellent advice on a successful bond issue Cydefex wants to expand globally through an international investment and is asking you for advice on: Acquiring a local manufacturer Licensing production of their proprietary drugs - Making a greenfield investment