copyright © 2006 pearson addison-wesley. all rights reserved.8-1 exhibit 8.1 conceptual comparison...

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Copyright © 2006 Pearson Addison-Wesley. All rights reserved. 8-1 Exhibit 8.1 Conceptual Comparison of Transaction, Operating, and Translation Foreign Exchange Exposure

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Page 1: Copyright © 2006 Pearson Addison-Wesley. All rights reserved.8-1 Exhibit 8.1 Conceptual Comparison of Transaction, Operating, and Translation Foreign Exchange

Copyright © 2006 Pearson Addison-Wesley. All rights reserved. 8-1

Exhibit 8.1 Conceptual Comparison of Transaction, Operating, and Translation Foreign Exchange Exposure

Page 2: Copyright © 2006 Pearson Addison-Wesley. All rights reserved.8-1 Exhibit 8.1 Conceptual Comparison of Transaction, Operating, and Translation Foreign Exchange

Copyright © 2006 Pearson Addison-Wesley. All rights reserved. 8-2

Exhibit 8.2 Impact of Hedging on the Expected Cash Flows of the Firm

Page 3: Copyright © 2006 Pearson Addison-Wesley. All rights reserved.8-1 Exhibit 8.1 Conceptual Comparison of Transaction, Operating, and Translation Foreign Exchange

Copyright © 2006 Pearson Addison-Wesley. All rights reserved. 8-3

Exhibit 8.3 The Life Span of a Transaction Exposure

Page 4: Copyright © 2006 Pearson Addison-Wesley. All rights reserved.8-1 Exhibit 8.1 Conceptual Comparison of Transaction, Operating, and Translation Foreign Exchange

Copyright © 2006 Pearson Addison-Wesley. All rights reserved. 8-4

Exhibit 8.4 Valuation of Cash Flows by Hedging Alternative for Trident

Page 5: Copyright © 2006 Pearson Addison-Wesley. All rights reserved.8-1 Exhibit 8.1 Conceptual Comparison of Transaction, Operating, and Translation Foreign Exchange

Copyright © 2006 Pearson Addison-Wesley. All rights reserved. 8-5

Exhibit 8.5 Trident’s Hedging Alternatives, Including an ATM Put Option

Page 6: Copyright © 2006 Pearson Addison-Wesley. All rights reserved.8-1 Exhibit 8.1 Conceptual Comparison of Transaction, Operating, and Translation Foreign Exchange

Copyright © 2006 Pearson Addison-Wesley. All rights reserved. 8-6

Exhibit 8.6 Valuation of Hedging Alternatives for an Account Payable

Page 7: Copyright © 2006 Pearson Addison-Wesley. All rights reserved.8-1 Exhibit 8.1 Conceptual Comparison of Transaction, Operating, and Translation Foreign Exchange

Copyright © 2006 Pearson Addison-Wesley. All rights reserved. 8-7

Exhibit 8.7 Bank of America Corporate FX Risk Management Survey Results

Page 8: Copyright © 2006 Pearson Addison-Wesley. All rights reserved.8-1 Exhibit 8.1 Conceptual Comparison of Transaction, Operating, and Translation Foreign Exchange

Copyright © 2006 Pearson Addison-Wesley. All rights reserved. 8-8

Mini-Case Lufthansa 1985–1986: What Herr Ruhnau Could and Could Not See