You Are Analyzing a Very Low-Risk Project with an Initial

question 247

Multiple Choice

You are analyzing a very low-risk project with an initial cost of £120,000. The project is expected to return £40,000 the first year, £50,000 the second year and £60,000 the third and final year. The
Current spot rate is £.54. The nominal return relevant to the project is 4 percent in the U.K. and 3
Percent in Canada. Assume that uncovered interest rate parity exists. What is the net present value
Of this project in dollars?

• A) $33,232
• B) $34,040
• C) $34,067
• D) $34,422
• E) $35,009

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Definitions:

Monomer Units

Individual, small molecules that can bind chemically to other monomers to form polymers through repeated sequences.

Repeating Segment

A consistent sequence of atoms or groups within a polymer that repeats along its chain.

Nylon 6,6

A type of polyamide made by polymerizing hexamethylene diamine and adipic acid, known for its strong, elastic, and resistant properties, used in textiles and engineering plastics.

Monomers

Simple molecules that can undergo polymerization to form more complex molecules called polymers, serving as the building blocks for a variety of macromolecules.