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I need help with an assignment; i have attached it with this mail. I have also attached an excel file here which is the solver.It has to be answered on the excel solver orspreadsheet.

Problems Problem 31-3 Problem 31-4 Problem 31-8 Problem 31-13 Table 31-1 Problem 31-3 Etemadi Amalgamated, a U.S. manufacturing firm, is considering a new project in the euro area. You are in Etemadi's corporate finance department and are responsible for deciding whether to undertake the project. The expected free cash flows, in euros, are shown here. Free Cash Flow ( million) Year 0 1 2 3 4 You know that the spot exchange rate is S = $1.15/. In addition, the risk-free interest rate on dollars is 4% and the risk-free interest rate on euros is 6%. Assume that these markets are internationally integrated and the uncertainty in the free cash flows is not correlated with uncertainty in the exchange rate. You determine that the dollar WACC for these cash flows is 8.5%. What is the dollar present value of the project? Should Etemadi Amalgamated undertake the project? Spot rate Risk free rate on USD Risk free rate on EUR Free Cash Flow (in ) Year 0 1 2 3 4 WACC Project value Undertake Project? 8.50% 0.00 no Expected Free Cash Spot rate Flow (in $) 0.0000 0.000 0.0000 0.000 0.0000 0.000 0.0000 0.000 0.0000 0.000 Problem 31-4 Etemadi Amalgamated, the U.S. manufacturing company in Problem 3, is still considering a new project in the euro area. All information presented in Problem 3 is still accurate, except the spot rate is now S = $0.85/, about 26% lower. What is the new present value of the project in dollars? Should Etemadi Amalgamated undertake the project? Spot rate Risk free rate on USD Risk free rate on EUR Free Cash Flow (in ) Year 0 1 2 3 4 WACC Project value Undertake Project? 8.50% 0.00 no Expected Spot rate 0.00 0.00 0.00 0.00 0.00 Free Cash Flow (in $) 0.00 0.00 0.00 0.00 0.00 Problem 31-8 Manzetti Foods, a U.S. food processing and distribution company, is considering an investment in the euro area. You are in Manzetti's corporate finance department and are responsible for deciding whether to undertake the project. The expected free cash flows, in euros, are uncorrelated to the spot exchange rate and are shown here. Free Cash Flow ( million) -25 12 14 15 15 Year 0 1 2 3 4 The new project has similar dollar risk to Manzetti's other projects. The company knows that its overall dollar WACC is 9.5%, so it feels comfortable using this WACC for the project. The risk-free interest rate on dollars is 4.5% and the risk-free interest rate on euros is 7%. Risk free rate on USD Risk free rate on EUR Free Cash Flow (in ) Year 0 1 2 3 4 a. Manzetti is willing to assume that capital markets in the United States and the euro area are internationally integrated. What is the company's euro WACC? US WACC Euro WACC 0.00% b. What is the present value of the project in euros? Project value Undertake Project? 0.00 no Problem 31-13 Assume that in the original Ityesi example in Table 31.1, all sales actually occur in the United States and are projected to be $60 million per year for 4 years. Keeping other costs the same, calculate the NPV of the investment opportunity. Table 31.1 :Expected Free Cash Flows from Ityesi's U.K. ProjectAll Translated to USD Year Incremental Earnings Forecast ( million) 1 Sales 2 Cost of Goods Sold 3 Gross Profit 4 Operating Expenses 5 Depreciation 6 EBIT 7 Income tax at 40% 8 Unlevered Net Income Free Cash Flow 9 Plus: Depreciation 10 Less: Capital Expenditures 11 Less: Increases in NWC 12 Pound Free Cash Flows Forward Exchange Rate Dollar Free Cash Flows Sales in US Total Dollar Free Cash Flows WACC in US NPV 0 1 2 3 4 0.000 0.000 (4.167) 0.000 (4.167) (1.667) (2.500) (15.625) (15.625) (5.625) (3.750) (25.000) 5.000 (30.000) (15.625) (15.625) (5.625) (3.750) (25.000) 5.000 (30.000) (15.625) (15.625) (5.625) (3.750) (25.000) 5.000 (30.000) (15.625) (15.625) (5.625) (3.750) (25.000) 5.000 (30.000) 0.000 (15.000) 0.000 (17.500) 3.750 0.000 0.000 (26.250) 3.750 0.000 0.000 (26.250) 3.750 0.000 0.000 (26.250) 3.750 0.000 0.000 (26.250) 0.000 0.000 0.000 0.000 0.000 60.000 60.000 0.000 0.000 60.000 60.000 0.000 0.000 60.000 60.000 0.000 0.000 60.000 60.000 240.0000 Table 31.1: Expected Foreign Free Cash Flows from Ityesi's U.K. Project Year Incremental Earnings Forecast ( million) 1 Sales 2 Cost of Goods Sold 3 Gross Profit 4 Operating Expenses 5 Depreciation 6 EBIT 7 Income tax at 40% 8 Unlevered Net Income Free Cash Flow 9 Plus: Depreciation 10 Less: Capital Expenditures 11 Less: Increases in NWC 12 Pound Free Cash Flows Risk-free rate in U.S. Risk-free rate in UK 0 1 2 3 4 (4.167) (1.667) (2.500) 37.500 (15.625) 21.875 (5.625) (3.750) 12.500 5.000 7.500 37.500 (15.625) 21.875 (5.625) (3.750) 12.500 5.000 7.500 37.500 (15.625) 21.875 (5.625) (3.750) 12.500 5.000 7.500 3.750 0.000 (4.167) 37.500 (15.625) 21.875 (5.625) (3.750) 12.500 5.000 7.500 3.750 3.750 3.750 11.250 11.250 11.250 11.250 (15.000) (17.500) FIN516 WEEK 7 - HOMEWORK Problem 31-1 on Exchange Rates based on Chapter 31 International Corporate Finance (Excel file included) You are a U.S. investor who is trying to calculate the present value of a 5 million cash inflow that will occur 1 year in the future. The spot exchange rate is S = $1.25/ and the forward rate is F1 = $1.215/. You estimate that the appropriate dollar discount rate for this cash flow is 4% and the appropriate euro discount rate is 7%. a. What is the present value of the 5 million cash inflow computed by first discounting the euro and then converting it into dollars? b. What is the present value of the 5 million cash inflow computed by first converting the cash flow into dollars and then discounting? c. What can you conclude about whether these markets are internationally integrated, based on your answers to parts (a) and (b)? Problem 31-2 on Currency Appreciation based on Chapter 31 International Corporate Finance (Excel file included) Mia Caruso Enterprises, a U.S. manufacturer of children's toys, has made a sale in Cyprus and is expecting a C4 million cash inflow in 1 year. The current spot rate is S = $1.80/C and the one-year forward rate is F1 = $1.8857/C. a. What is the present value of Mia Caruso's C4 million inflow computed by first discounting the cash flow at the appropriate Cypriot pound discount rate of 5%, and then converting the result into dollars? b. What is the present value of Mia Caruso's C4 million inflow computed by first converting the cash flow into dollars, and then discounting at the appropriate dollar discount rate of 10%? c. What can you conclude about whether these markets are internationally integrated, based on your answers to parts A and B? FIN516 WEEK 7 - HOMEWORK Problem 31-7 on Eurobonds versus Domestic Bonds based on Chapter 31 International Corporate Finance The dollar cost of debt for Coval Consulting, a U.S. research firm, is 7.5%. The firm faces a tax rate of 30% on all income, no matter where it is earned. Managers in the firm need to know its yen cost of debt because they are considering launching a new bond issue in Tokyo to raise money for a new investment there. The risk-free interest rates on dollars and yen are r $ = 5% and r = 1%, respectively. Coval Consulting is willing to assume that capital markets are internationally integrated and that its free cash flows are uncorrelated with the yen-dollar spot rate. What is Coval Consulting's after-tax cost of debt in yen? (Hint: Start by finding the after-tax cost of debt in dollars and then find the yen equivalent.) Problem 31-12 on Credit & Exchange Rate Risk based on Chapter 31 International Corporate Finance Suppose the interest on Russian government bonds is 7.5%, and the current exchange rate is 28 rubles per dollar. If the forward exchange rate is 28.5 rubles per dollar, and the current U.S. risk-free interest rate is 4.5%, what is the implied credit spread for Russian government bonds