6. Identify whether the following create substantial transaction, operating, and/or translation exposure (or no exposure at all) for a U.S. company, and how the company will be affected if the foreign currency depreciates. The examples will typically create more than one type of exposure.

a) Budweiser sells 50 mln euro worth of beer in Germany; payment will be made in euro next October.

b) Honda-U.S. imports parts from its Japanese parent corporation, and locks in a dollar price through a forward contract.

c) IBM issues Swiss franc-denominated bonds in Zurich.

d) Widgets International (WI) purchases a British factory, financed by issuing dollar debt and swapping for pound-denominated debt. WI is expecting a steady stream of pound revenues from the factory. FASB 8 is in effect.

e) Same as above, only FASB 52 is in effect.