9) (5 pts in some cases a host country may block funds that the subsidiary attempts to send back to the parent. Hin problem 7, the Thal government requires the subsidiary to reinvest any cash flows from the project Into Singapore Government bonds (currently ylelding 12% Interest per year during year 1 and year 2 and only remit funds back to the parent at the end of year 3. Calculate the NPV of the project under the original FX rate assumptions as follows: Assume the required rate of return for this Year Year 2 Year $0.051 $0.050 $0.049 project is 9% Year o $0.052 FX rate: Yro Initial Investment Y -50 million THB OCF produced By the Subsidiary 16 mil THB 16 mil THB 16 mil THE XD OUT S$ Salvage value (50,000,000) X 0.052 25 mil The Doug 8 4000 122500 2009000 -2 2600DOO (1 +0-09) = 260,000 1551319 a) NPV under blocked funds - 1048683 10) (5 pts) Refer to Problem 9 and consider the effects of the blocked funds on the NPV. Describe the two most important factors driving the results of the effect on NPV assuming a blocked funds scenario (Hint, one of them has a negative impact on NPV and the other has a positive impact on NPV) a) 97 12%. WACC (WAL96