Question: Please show all working and formulas used, thanks! 16. BBB Ltd., is a New Zealand domiciled company which is considering entering into a joint venture

Please show all working and formulas used, thanks! 16. BBB Ltd.,

Please show all working and formulas used, thanks!

16. BBB Ltd., is a New Zealand domiciled company which is considering entering into a joint venture in China with a local company based in Guangzhou. The investment is expected to generate (in millions of Yuan) the following cash flows: Year CF 0 -4,500.0 2 2,400.0 1,300.0 3,500.0 The NZ risk-free rate is 2% and the rate in China is 4%. The spot rate is: CNY4.50 : NZD1.00 and BBB Ltd., has a New Zealand Dollar WACC of 12%. a. Calculate the appropriate forward exchange rates for this project. (2 marks) b. Calculate the appropriate NZD equivalent cash flows for this project. (2 marks) C. Calculate the appropriate NPV of this project. (2 marks)

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