52 Continued from Question 48, what are the expected U.S. dollars UCD ends up receiving for its 250,000 euro receivable based its exchange rate forecasting given below? Probability 15% 6096 Scenario Spot Exchange Rate One Year Later $1.14 $1.20 25% a. $291,250.00. b. $296,250.00. c. $292,500.00. d. $293,250.00. (Q53 and Q54 are similar to Ch16 slides 13-30; detailed calculations are given there.) 53. Tovar, a U.S. firm, would need to spend $400,000 today on expenses related to its consulting services to Grecia Company (in Greece) to improve Grecia's performance. In one year, Tovar will receive payment from Grecia, which will be tied to Grecia's performance during the year. There is uncertainty about Grecia's performance and about Grecia's tendency for corruption. Tovar expects that it will receive 500,000 euros if Grecia achieves strong performance following the consulting job. However, there are two forms of country risk that are a concern to Tovar Co. There is a 60 percent chance that Grecia will achieve strong performance. There is a 40 percent chance that Grecia will perform poorly, and in this case, Tovar will receive a payment of only 420,000 euros. While there is a 60 percent chance that Grecia will make its payment to Tovar, there is a 40 percent chance that Grecia will become corrupt, and in this case, Grecia will not submit any payment to Tovar. Assume that the outcome of Grecia's performance is independent of whether Grecia euro will whether it is corrupt Tova's cost of capital is 20%. corrupt. The prevailing spot rate of the euro is $1.20, but Tovar expects that the depreciate by 8 percent in one year, regardless of Grecia's performance or What is the expected value of the project's net present value? a. -$141,664 b. -$367,600 c. $60,000 d. -$27,600 e. -$400,000