Question: Question 1 and 2 are linked. Q1: Perth International Co., an Australian multinational company, forecasts 64 million Australian dollars (A$) earnings next year (i.e., year-one).
Question 1 and 2 are linked. Q1: Perth International Co., an Australian multinational company, forecasts 64 million Australian dollars (A$) earnings next year (i.e., year-one). It expects 59 million Chinese yuan (CNY), 45 million Indian rupees (INR) and 40 million Malaysian ringgit (MYR) proceeds of its three subsidiaries in year-one. It also forecasts the year-one exchange rates A$0.2221/CNY, A$0.0311/INR and A$0.5341/MYR. Calculate the total Australian dollar (A$) cash flow for year-one. (enter the whole number with no sign or symbol) From my calculations, answer for Q1 is 99,867,400. Q2: Perth International has closed its business in Australia after year-one and anticipates a 4.94 per cent increase in the year-one income of its subsidiaries in year-two. It has information that the current 4.78 per cent, 7.13 per cent, 13.62 per cent and 11.48 per cent nominal interest rate in Australia, China, India and Malaysia, respectively, will remain the same in the next three years. Due to foreign currency higher nominal interest rate, subsidiaries will invest 24 per cent, 57 per cent and 43 per cent of their year-two earnings in China, India and Malaysia, respectively, for next year. Subsidiaries will remit their remaining incomes (i.e., after investment) to the Australian parent. Perth International believes in the International Fisher Effects with considering a 2.46 per cent real interest in Australia, China, India and Malaysia to calculate the expected foreign currency value against the Australian dollar for year-two based on the year-one exchange rates A$/CNY, A$/INR, and A$/MYR.
What is the total Australian dollar (A$) cash flow for year-two? (enter the whole number with no sign or symbol) ***Please help me for Q2 only, do note to draw reference from Q1 to help you answer Q2***
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