Speculation of Exchange Rate Risk and Hedging.

At the end of 2002, the (1-year) interest rate was 1% in the U.S., and 26% in Argentina. Recall that at the same time, the spot rate for the Argentine currency was Peso 4.00/$. Yankee Burger expects sale revenues of 200 million Pesos in 2003 from its chain of restaurants in Argentina. These revenues will be collected at end of 2003.