What is the npv of the project

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You work for a firm whose home currency is the Euro (EUR) and that is considering a foreign investment. The investment yields expected after-tax Swiss Franc (SFR) cash flows (in millions) as follows: -SFR305 in Year 0 and SFR130 in Year 1. The forecast free cash flow will then increase by 5% per annum over the next 3 years. At the end of 4 years, the life of the project will end. The expected rates of inflation in each country are constant per year: 4% in the Eurozone, and 9.00% in Switzerland. From the project's perspective the required return is 13.74%, while from the parent's perspective, the required rate of return is 8.52%. The spot exchange rate is EUR0.9615/SFR.

What is the NPV of the project from the project's perspective?

Reference no: EM133121874

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