Read the article and answer the questions

Read the management focus, 'Volkswagen’s Hedging Strategy'( attached) and answer the following questions.

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a. Why do you think management at Volkswagen decided to hedge only 30% of the automaker's foreign currency exposure in 2003?

b. What would have happened if it had hedged 70% of exposure?

c. Apart from hedging through the foreign exchange market, what else can Volkswagen do to reduce its exposure to future declines in the value of the U.S. dollar against the euro?