8. Santa Clara Electronics: Revenue Growth Scenario. As a result of their analysis in Problem 7, Santa
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8. Santa Clara Electronics: Revenue Growth Scenario. As a result of their analysis in Problem 7, Santa Clara wishes to explore the implications of being able to grow sales volume by 4% per year. Argentine inflation is expected to average 5% per year, so sales price and material cost increases of 7% and 6% per year, respectively, are thought to be reasonable. Although material costs in Argentina are expected to rise, U.S.-based costs are not expected to change over the five-year period. Evaluate this sce- nario for both the project and parent viewpoints. Is the project under this revenue growth scenario acceptable?
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Fundamentals Of Multinational Finance
ISBN: 9780321541642
3rd Edition
Authors: Michael H. Moffett, Arthur I. Stonehill, David K. Eiteman
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