1. Assume that Baps Corp. is considering the establishment of a subsidiary in Norway. The initial investment required by the parent is $5 million. If the project is undertaken, Baps would terminate the project after four years. Baps's cost of capital is 13%, and the project has the same risk as Baps's existing projects. All cash flows generated from the project will be remitted to the parent at the end of each year. Listed below are the estimated cash flows the Norwegian subsidiary will generate over the project's lifetime in Norwegian kroner (NOK):

Year 1	Year 2	Year 3	Year 4
NOK10,000,000	NOK15,000,000	NOK17,000,000	NOK20,000,000

The current exchange rate of the Norwegian kroner is $.135. Baps's exchange rate forecasts for the Norwegian kroner over the project's lifetime are listed below:

Year 1	Year 2	Year 3	Year 4
$.13	$.14	$.12	$.15

Calculate the NPV of the Project- show the calculation. Should the company do the Project?

NOTE: I need the question to be solved manually and not with Excel sheet. Please :)