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A swiss subsidiary belongs to a German parent company. Assume the Swiss subsidiary will operate 5 years and stop at the end of the 5th

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A swiss subsidiary belongs to a German parent company. Assume the Swiss subsidiary will operate 5 years and stop at the end of the 5th year. Inflation rate is expected to be 0% per year for SFs, and 2% per year for Euros. Real interest rate is 3% for both SF and Euro. The current exchange rate is 1.1SF/ Euro. The following table provides valuations based on the spot rate method and the forward rate method, respectively. What is the firm value (in euro) based on the spot rate method? What is the firm value (in euro) based on the forward rate method? 416:416 458;458 504: 361 458;361

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