A Canadian fashion shop has formed a joing venture with a UK firm. They expect to receive cash dividends from the joint venture over the next 4 years. The firsrt dividend will be paid one year later with an amount of GBP 50,000 and with a 10% annual growth rate. Assume the current CAD/GBP exchange rate is CAD$1.58/GBP and the company has a WACC of 11%. 1. What is the present value of the expected dividend stream in CAD if the GBP is expected to appreciate 3% per year vs. the CAD? 2. What is the present value of the expected dividend stream in CAD if the GBP is expected to depreciate 4% a year vs. the CAD? hint: use a spreadsheet with these headings... ...YEAR 1......YEAR 2......YEAR 3........YEAR 4 EXPECTED DIVIDEND PAYMENT IN GBP EXPECTED CAD/GBP EXCHANGE EXPECTED CAD DIVIDEND DISCOUNT FACTOR PV EXPECTED DIVIDEND PAYMENTS PER YEAR PV EXPECTED DIVIDEND STREAM