Reference no: EM132675196

Problem 1: The Perth International Co. anticipates 49 million Australian dollars (A$) earnings in Australia next year (i.e., year-one). It expects 52 million Hong Kong dollar (H$), 63 million Singapore dollar (S$) and 76 million New Zealand dollar (N$) incomes of its subsidiaries in Hong Kong, Singapore and New Zealand, respectively, in year-one. It also forecasts H$46 million, S$59 million and N$61 million proceeds of its subsidiaries after two years. The Perth International expects the current exchange rates A$0.2885/H$, A$0.8627/S$ and A$0.7510/N$ will be remaining the same in the next two years. If the subsidiaries remit their revenues to the Australian parent at the end of each year, estimate the value of Perth international based on its 6.11 per cent weighted average cost of capital or required rate of return.