Please answer thoroughly and clearly. Thank You!

Chapter 10 Hedging A/Rs Tektronix, Inc. (TEK) is an MNE based in Beaverton, Oregon. Tck's sales in the fiscal year ending May 31, 2006 were about S1 blion. Its main products are scientific measuring instruments such as protocol analyses and simulators, network monitoring systems, transmission and cable test products, and a broad range of oscilloscopes. Part of the foreign sales were direct exports from Tck's Beaverton manufacturing and research facility. A second part of sales were passed through Tek's own foreign sales and assembly subsidiaries. A third part of sales were through joint ventures such as in Japan (Sony) and China. Tck also imported components and other materials that were used in the manufacturing operations in Beaverton. Tek's main competitors are Agilent (formerly HP's mcasuring instruments business) and Siemens (a very large German conglomerate). Tck wishes to hedge a 4,000,000 account receivable arising from a sale to Olivetti (Italy). Payment is due in three months. Tek's Italian unit has obtained information about local currency borrowing and Citibank has offered Tek the other quotes: Spot rate: Three-month forward rate Three-month put option on euros at strike price of $1.0800 E: Tck's weighted average cost of capital: S1.2000 S1.2180/E 3.40% premium 9.80% p-a. Which alternative should Tek choose if it prefers to play it safe? Which alternative should Tc choose if it is willing to take a reasonable risk and has a directional view that the euro may be appreciating vs. the dolar during the next three months? Please explain what TEK needs to do in cach hedge and what the best decision is. Chapter 10 Hedging A/Rs Tektronix, Inc. (TEK) is an MNE based in Beaverton, Oregon. Tck's sales in the fiscal year ending May 31, 2006 were about S1 blion. Its main products are scientific measuring instruments such as protocol analyses and simulators, network monitoring systems, transmission and cable test products, and a broad range of oscilloscopes. Part of the foreign sales were direct exports from Tck's Beaverton manufacturing and research facility. A second part of sales were passed through Tek's own foreign sales and assembly subsidiaries. A third part of sales were through joint ventures such as in Japan (Sony) and China. Tck also imported components and other materials that were used in the manufacturing operations in Beaverton. Tek's main competitors are Agilent (formerly HP's mcasuring instruments business) and Siemens (a very large German conglomerate). Tck wishes to hedge a 4,000,000 account receivable arising from a sale to Olivetti (Italy). Payment is due in three months. Tek's Italian unit has obtained information about local currency borrowing and Citibank has offered Tek the other quotes: Spot rate: Three-month forward rate Three-month put option on euros at strike price of $1.0800 E: Tck's weighted average cost of capital: S1.2000 S1.2180/E 3.40% premium 9.80% p-a. Which alternative should Tek choose if it prefers to play it safe? Which alternative should Tc choose if it is willing to take a reasonable risk and has a directional view that the euro may be appreciating vs. the dolar during the next three months? Please explain what TEK needs to do in cach hedge and what the best decision is