[bloomers2004]

I need some help in the following questions:

1) Explain how the basic translation hedging strategy were.

2) European aircraft manufacturers have been buying out jet engines from US companies. As a result of weaker dollar, the lower price of jet engines for the European aircraft manufacturers is giving them a competitive advantage over the US aircraft manufacturers. Do you agree?

3) Economists have argued that product companies are not calculating the cost of not investing in new technology & manufacturing facilties or market position overseas. Wat are these cost? How do these costs relate to the notion of growth option?

4) A Healthcare products multinational generate slightly more than 50% of its slaes overseas. Both the domestic and the international treasury groups manufactured sizeable cash portfolios. Moreover, it was significantly increasing its issues of US commercial paper and it had cash surpluses. Intercompany’s sales policy made on an arm length baiss. Each foreign unit makes its intercompany credits, payments and hedging decisions independently. What advantage might the company from centralizing international cash manufacture and foreign exchange management.

5)How can taxes affect the choice of currency denomination for loans
how can the choice of currency denomination of loans enable a firm to reduce its exchange risk.

Thanks.