and #2. rates: Cross-border capital budgeting when international parity does not hold. Should the manager invest? Should the manager hedge the project's 13.5 Consider the investment in China from Problem 13.1. a. Suppose that a manager expects the following future exchange E[S, ILS/CNY) = ILS 0.5801/CNY ELS_ILS/CNY) = ILS 0.6089/CNY E[S, ILS/CNY] = ILS 0.6392/CNY Using a yuan discount rate of 11.745 percent and the shekel discount rate of 15 percent, calculate NPV from the parent and project perspectives. Should the manager invest in the project? Should the manager hedge the project's currency risk exposure? b. Repeat part (a) using the following expected spot rates of exchange: E[S, ILS/CNY) = ILS 0.5575/CNY E[S, ILS/CNY) = ILS 0.5625/CNY E[S3 ILS/CNY] = ILS 0.5676/CNY currency risk exposure? 13.6 Considonul and #2. rates: Cross-border capital budgeting when international parity does not hold. Should the manager invest? Should the manager hedge the project's 13.5 Consider the investment in China from Problem 13.1. a. Suppose that a manager expects the following future exchange E[S, ILS/CNY) = ILS 0.5801/CNY ELS_ILS/CNY) = ILS 0.6089/CNY E[S, ILS/CNY] = ILS 0.6392/CNY Using a yuan discount rate of 11.745 percent and the shekel discount rate of 15 percent, calculate NPV from the parent and project perspectives. Should the manager invest in the project? Should the manager hedge the project's currency risk exposure? b. Repeat part (a) using the following expected spot rates of exchange: E[S, ILS/CNY) = ILS 0.5575/CNY E[S, ILS/CNY) = ILS 0.5625/CNY E[S3 ILS/CNY] = ILS 0.5676/CNY currency risk exposure? 13.6 Considonul