International Finance Management Poisonous Pink Limited is a firm based in lowa, United States ofAmerica is considering investing in a project at Poland. Theduration of the project is 3 years. At the end of third years,Poisonous Pink Limited will sell the project to a local firm. Theinitial investment of the project is $300,000. According toPoisonous Pink Limited financial analyst, the cost of capital forthe similar project in US is 15 percent. The projected cash flow asfollowing:Cash FlowPLN 30,000PLN 70,000PLN 12,000Forecasted Exchange$3.3047$3.3289$3.3113Year13Compute the potential investment's Net Present Value (NPV) andthe salvage value of Poisonous Pink Limited if they sell the projectat the end of year 3 to a local company.

Given information : Year Exchange rate Cash flow (PLN) 0 1 $3.3047 30,000 2 $3.33 70000…

Answered: States of Poisonous Pink Limited is a…

International Financial Management

14th Edition

ISBN:9780357130698

Author:Madura

Publisher:Madura

Chapter14: Multinational Capital Budgeting

Section: Chapter Questions

Problem 34QA

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