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Analyze the following. a. How does the international price elasticity of demand for exports affect the profitability of an investment? b. Let us say, we
Analyze the following.
a. How does the international price elasticity of demand for exports affect the profitability of an investment?
b. Let us say, we borrow 90% of a capital budgeting project costing $100 million. That means we use the equity of $10 million. We also need additional labor to set up the project. What is the total cost of this investment?
c. We invest in a foreign land. The host government provides a subsidy for us of $30 million in equivalent foreign money. What is our investment?
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