3. Why is GM worried about the ARS exposure? What operational decisions could it have made or now make to manage this exposure? (Check exhibit 12 and 13—what are the forward rates telling you? Recall that we learned that forward rates capture market expectations of future exchange rate movements? What does this mean for how expensive hedging is by this time? Indeed, this is why anticipatory risk management is so critical—when hedging a risk is the most desirable, the cost of that hedge rises substantially too. Good news is that there are some non-financial alternatives to hedging this exposure…)