Question: You work for a U.S.-based firm that has a subsidiary in Egypt. The subsidiary generates substantial earnings in Egyptian pounds (EGP) every year. One week

You work for a U.S.-based firm that has a subsidiary in Egypt. The subsidiary generates substantial earnings in Egyptian pounds (EGP) every year. One week ago, your firm received an offer for the subsidiary from a company to purchase it (in USD), and your firm has not yet responded to this offer. Since last week, the expected stream of EGP cash flows has not changed, but the forecasts of the EGPs value in future periods have increased. Will the NPV of the divestiture be larger, smaller or the same as it was last week? Briefly explain (in one or two sentences at most).

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