Caterpillar (u. s.) just purchased a korean company that produces plastic nuts and bolts for heavy equipment. the purchase price was won7,030 million. won1,000 mllion has already been paid, and the remaining won6,030 million is due in six months. the current spot rate is won1200/$, and the 6-month forward rate is won 1260$.six month korean rate: 16.00% p. a.six month us interest rate : 4.00% p. a.six month call option on korean : 3.00% premium won at w1200/$ six-month put option on korean : 2.4% premiumwon at w 1200/$caterpillar can invest at the rates given in the pre ceding table, or borrow at 2% per annum above those rates. cat's weighted average cost of capital is 10%. compare alternate ways that caterpillar might deal with its foreign exchange exposure. what do you recommend and why?

1. alwaysrain irrigation, inc. would like to determine capacity requirements for the next four years. currently, two production lines are in place for making bronze and plastic sprinklers. three types of sprinklers are available in both bronze and plastic: 90-degree nozzle sprinklers, 180-degree nozzle sprinklers, and 360-degree nozzle sprinklers. management has forecast demand for the next four years as follows: both production lines can produce all the different types of nozzles. the bronze machines needed for the bronze sprinklers require two operators and can produce up to 12,000 sprinklers. the plastic injection molding machine needed for the plastic sprinklers requires four operators and can produce up to 200,000 sprinklers. three bronze machines and only one injection molding machine are available. what are the capacity requirements for the next four years? (assume that there is no learning.)