Domestic NPV approach. Farbucks is thinking of expanding to South Korea. The current indirect rate for dollars and South Korean won is 1,016 won per dollar. The expected inflation rate in South Korea should hover near 1.3% for the next five years. The expected U.S. inflation rate should stay around 3.4%. The discount rate for expanding is 13% for Farbucks. Given the following projected cash flows for the expansion project, use the domestic NPV approach to determine whether Farbucks should expand to South Korea. Year 0: initial investment costs of 85,000,000 won per coffee shop Year 1 cash flow: 20,000,000 won Year 2 cash flow: 40,000,000 won Year 3 cash flow: 65,000,000 won Year 4 cash flow: 85,000,000 won Year 5 cash flow: 45,000,000 won Domestic currency approach in multinational capital budgeting consists of the following steps: Step 1: Calculate the forward exchange rates. Step 2: Convert all cash flows in foreign currency into dollars using current and forward exchange rates. Step 3: Convert all future dollars into present value with the domestic discount rate. Step 4: Add the net present value of the outflow and inflow. Step 5: Accept the project if its net present value (NPV) is positive and reject if negative