Advise the US subsidiary of Greenfields plc on the hedging strategy that should be adopted for the contract with Palermo Plc based on your analysis.
Part A: The subsidiary in Jifi produces Tech-Plough. Annually it produces 800 units and sells all of them to the subsidiary in Camaija for £10,000 each. It incurs variable costs of £5,000 for each unit and total annual fixed costs of £400,000. The subsidiary in Camaija builds additional functionality to Tech-Plough to make Tech-Plough Plus. […]