b. Now, assume that appreciates against Cr 20% for each period (instead of 25% in your text/lecture note example), but all other values are the same from the example.

(i) Find the NPV of the Wendys project based on Recipe #1 using equation (13.2). Hint: the expected cash flows in Cr (E[CF_t^Cr]) will be the same as in Exhibit 13.5. Why? Do NOT present Table, but utilize the equation.

13.2 Wendy's Restaurant in Neverland Recipe 1: Discounting in crocs t=0 t=1 t=2 t=3 t=4 Bal sheet CF -64,000 121,920 Operating CF 16,060 27,720 39,257 26,627 E(CF.C. -64,000 16,060 27,720 39,257 148,547 v Cr =Cro at iCr= 50% or Vflicr= 0 at S. Crl = Cr4/ Vodlif = s,d/f [,E[CF,f)/(1+if'] or V, 4lif = sed/fv. (13.2) V41id = 2,E[CF,*]F,4//(1+i)" (13.5) 13.2 Wendy's Restaurant in Neverland Recipe 1: Discounting in crocs t=0 t=1 t=2 t=3 t=4 Bal sheet CF -64,000 121,920 Operating CF 16,060 27,720 39,257 26,627 E(CF.C. -64,000 16,060 27,720 39,257 148,547 v Cr =Cro at iCr= 50% or Vflicr= 0 at S. Crl = Cr4/ Vodlif = s,d/f [,E[CF,f)/(1+if'] or V, 4lif = sed/fv. (13.2) V41id = 2,E[CF,*]F,4//(1+i)" (13.5)