Example: Infosys Limited, an Indian multinational company, is considering a foreign investment in Japan. The investment...

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Example: Infosys Limited, an Indian multinational company, is considering a foreign investment in Japan. The investment yields expected after-tax Japanese Yen (JPY) cash flows (in millions) as follows: Year 0 -JPY2,100 Year 1 JPY800 Year 2 JPY800 Year 3 JPY800 Expected inflation is 6.5% in the Indian rupee and 2.7% in the Japanese yen. Assume that the international parity conditions hold. INR= 16.5% in Indian rupee; and iJPY = 12.343% in Japanese yen The spot exchange rate is So INR/JPY y = INR 0.67/JPY What is the NPV of the investment from the parent's perspective? What is the NPV of the investment from the project's perspective? I Example: Infosys Limited, an Indian multinational company, is considering a foreign investment in Japan. The investment yields expected after-tax Japanese Yen (JPY) cash flows (in millions) as follows: Year 0 -JPY2,100 Year 1 JPY800 Year 2 JPY800 Year 3 JPY800 Expected inflation is 6.5% in the Indian rupee and 2.7% in the Japanese yen. Assume that the international parity conditions hold. INR= 16.5% in Indian rupee; and iJPY = 12.343% in Japanese yen The spot exchange rate is So INR/JPY y = INR 0.67/JPY What is the NPV of the investment from the parent's perspective? What is the NPV of the investment from the project's perspective? I