You work for Weird Fish Imports, which is a firm whose home currency is the Indian...
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You work for Weird Fish Imports, which is a firm whose home currency is the Indian rupee (INR) and that is considering a foreign investment. The investment yields expected after-tax Japanese yen (JPY) cash flows (in millions) as follows: • Year 0 -JPY 1,800 O a. O b. O C. O d. O e. Year 1 JPY750 Year 2 JPY750 Expected inflation is 6.0% in the Indian rupee and 8.0% in the Japanese yen. Assume that the international parity conditions hold. Required returns for projects in this risk class are: INR 15.0 % in Indian rupee; and • JPY = 17.1698% in Japanese yen Year 3 The NPV from the parent's perspective is -INR 109.31 million The NPV from the parent's perspective is -INR 113.14 million The NPV from the parent's perspective is -INR 113.87 million The NPV from the parent's perspective is -INR 107.13 million The NPV from the parent's perspective is -INR 111.78 million JPY750 The spot exchange rate is SNR/JPY = INR 0.7418/JPY. Given the above information, which of the following is closest to the NPV of the investment from the parent's perspective of Weird Fish Imports? You work for Weird Fish Imports, which is a firm whose home currency is the Indian rupee (INR) and that is considering a foreign investment. The investment yields expected after-tax Japanese yen (JPY) cash flows (in millions) as follows: • Year 0 -JPY 1,800 O a. O b. O C. O d. O e. Year 1 JPY750 Year 2 JPY750 Expected inflation is 6.0% in the Indian rupee and 8.0% in the Japanese yen. Assume that the international parity conditions hold. Required returns for projects in this risk class are: INR 15.0 % in Indian rupee; and • JPY = 17.1698% in Japanese yen Year 3 The NPV from the parent's perspective is -INR 109.31 million The NPV from the parent's perspective is -INR 113.14 million The NPV from the parent's perspective is -INR 113.87 million The NPV from the parent's perspective is -INR 107.13 million The NPV from the parent's perspective is -INR 111.78 million JPY750 The spot exchange rate is SNR/JPY = INR 0.7418/JPY. Given the above information, which of the following is closest to the NPV of the investment from the parent's perspective of Weird Fish Imports?
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Related Book For
Financial Accounting
ISBN: 978-1259103285
5th Canadian edition
Authors: Robert Libby, Patricia Libby, Daniel Short, George Kanaan, M
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