Excel Online Structured Activity: Foreign capital budgeting Sandrine Machinery is Swiss multinational manufacturing company. Currently, Sandrine's financial planners are considering undertaking a 1-year project in the United States. The project's expected dolar-denominated cash flows consist of an initial investment of $2000 and a cash flow the following year of $2400. Sandrine estimates that its risk adjusted cost of capital is 14%. Currently, 1 U.S. dollar will buy 0.8 Swiss franc. In addition, 1-year risk-free securities in the United States are yielding 7%, while similar securities in Switzerland are yielding 4.5. The data has been collected in the Microsoft Excel Online file below. Open the spreader and perform the required analysis to answer the questions below. Do not round intermediate calculations Open spreadsheet This project was introd undertaken by a simter US-based company with the same risk justed cost of capital, what would be the net present value and rate of retum generated by the project Round you were to two decimal places NPS Rate of return What is the expected forward exchange rate : year from now? Round your answer to two decimal places SF per U.S. 5 c. If Sandrine undertakes the project, what is the net present value and rate of return of the project for Sandrine? Do not round intermediate calculations. Round your answers to two decimal places NPV- Swiss Francs Rate of return B C D Foreign capital budgeting $2,000 $2,400 14.00% 5 0.8 7.00% 4.50% Initial investment (U.S. Dollars) Year 1 Inflow (U.S. Dollars) Risk-adjusted cost of capital Spot rate, Number Swiss francs per U.S. Dollar 7 Yield, 1-yr. U.S. securities 8 Yield, 1-yr. Swiss securities 9 10 U.S. NPV 11 U.S. rate of return 12 131-yr. forward rate, Swiss francs per U.S. Dollar 14 15 Initial investment (Swiss francs) 16 Year 1 Inflow (Swiss francs) 17 NPV (Swiss francs) 19 Swiss rate of return Formulas #N/A #N/A #N/A #N/A #N/A 18 #N/A #N/A 20