You Want to Invest in a Project in Canada

question 12

Multiple Choice

You want to invest in a project in Canada.The project has an initial cost of C$290,000 and is expected to produce cash inflows of C$120,000 a year for three years.The project will be worthless after three years.The expected inflation rate in Canada is 3.6 percent while it is 2.7 percent in the U.S.The applicable interest rate in Canada is 11.5 percent.The current spot rate is C$1 = $.97.What is the net present value of this project in U.S.dollars using the foreign currency approach?

• A)$736.42
• B)$714.33
• C)$692.90
• D)$708.16
• E)$703.08

---

Definitions:

Access Right

The privilege or ability to enter, retrieve, or make use of data or facilities.

Ethical Decision-Making Model

A structured approach to ensure decisions are made in a morally and ethically sound manner, considering all stakeholders involved.

Autonomy

The capacity to make an informed, uncoerced decision; in ethical and political philosophy, autonomy is often considered a fundamental right.

Beneficence

This is the ethical principle that guides actions aimed at doing good or benefiting others, commonly referenced in healthcare and research ethics.