You Are Analyzing a Project with an Initial Cost of £45,000

question 119

Multiple Choice

You are analyzing a project with an initial cost of £45,000. The project is expected to return £8,000
the first year, £22,000 the second year and £20,000 the third and final year. The current spot rate is£.57. The nominal risk-free return is 5.5 percent in the U.K. and 4.5 percent in Canada. The return relevant to the project is 9 percent in the U.K. and 10.5 percent in Canada. Assume that uncovered Interest rate parity exists. What is the net present value of this project in Canadian dollars?

• A) -$10,144
• B) $1,206
• C) $11,418
• D) $13,711
• E) $16,009

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Definitions:

Class Routine

A specific timetable or schedule that outlines the timing and sequence of academic classes or courses.

Hegemonic Masculinity

A concept that describes the culturally idealized form of masculine behavior, which emphasizes traits like competitiveness, dominance, and assertiveness, often to the detriment or exclusion of non-dominant masculinities.

Emphasized Femininity

A concept referring to the social construction of femininity as compliant, nurturing, and accommodating to the interests and desires of men.

Chilly Climate

An environment or situation where a group of people feels unwelcome or marginalized, often used to describe gender discrimination in educational and professional settings.