Question: Please show step by step in Excel. SPREADSHEET EXERCISE As the financial manager for a large multinational corporation IMNC), you have been asked to assess
Please show step by step in Excel.
SPREADSHEET EXERCISE As the financial manager for a large multinational corporation IMNC), you have been asked to assess the firm's economic exposure. The two major currencies, other than the U.S. dollar, that affect the company are the Mexican peso (MP) and the Brit. ish pound (E). You have been given the projected future cash flows for next year Toeal inflow Total ourflow Currency British pounds Mexican pesos 17,000,000 11,000,000 MP 100,000,000 MP25,000,000 The current expected exchange rate in U.S. dollars with respect to the two cur- rencies is as follows: Currency British pounds Mexican pesos 0.10(S/MP Exchange rate TO DO Assume that the movements in the Mexican peso and the British pound are highly correlated. Create a spreadsheet to answer the following questions. a. Determine the net cash flows for both the Mexican peso and the British pound. b. Determine the net cash flow as measured in U.S. dollars. It will represent the value of the economic exposure. Provide your assessment of the company's degree of economic exposure. In other words, is it high or low based on your findings in part b? cStep by Step Solution
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