Question: Please do not copy from another Chegg's answer Divestiture Decision Kylee Co. (a U.S. firm) has a British subsidiary that will generate cash flows of

Please do not copy from another Chegg's answer Divestiture Decision Kylee

Please do not copy from another Chegg's answer

Divestiture Decision Kylee Co. (a U.S. firm) has a British subsidiary that will generate cash flows of 3 million pounds at the end of each of the next two years. It uses the prevailing spot rate of the British pound of $1.80 as a forecast of the future value of the pound. Its required rate of return on this business is 16 percent. Kylee just received an offer from a British company who wants to buy the subsidiary for $8,000,000. Assume that Kylee would not be subject to any tax on the sale. a. Should Kylee Co sell the business? Show your work

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