BBB Inc a US MNC wants to construct a manufacturing plant in Japan. The construction will cost $110$ million Japanese Yen. BBB intends to leave the plant open for three years. During the three years of operation, cash flows are expected to be $40$ million Yen, $50$ million Yen, and $60$ million Yen, respectively. Operating cash flows will begin one year from today and are remitted back to the parent at the end of each year. At the end of the third year, BBB expects to sell the plant for $10$ million Japanese Yen. BBB has a required rate of return of $10\%.$ the current exchange rate is $128$Yen$/$$$,$ and this value is expected to remain constant over the next three years.

$1.$

The initial cost will be about $$\_\_\_\_.$

$2.$

The NPV of this new project will be about $$\_\_\_\_.$

$3.$

Assume that the funds are blocked, the parent company will only be able to remit them back to the U$.$S$.$ in year $3,$ and the parent company will reinvest the blocked funds in Japan at $4\%$ interest rate. The net present value of parent cash flows in year $3$ will be about $$\_\_\_\_.$

$4.$

According to the information in the previous question, the net present value of this international project will be about $$\_\_\_\_.$

$5.$

Assume that the value of the Japanese Yen will not be fixed, the inflation rate in the Yen is $$YEN$=3\%,$ the inflation rate in dollars is $$$$=5\%$ and PPP is expected to hold between the two countries, then the expected exchange rate of Yen in year $3$ will be about$\_\_\_\_$$$/$Yen$.$

$6.$

Using the information in the previous question, the foreign currency required rate of return for Yen will be about$\_\_\_\_.$