Global Trade Inc. is considering a foreign investment with a useful life of 6 years through its subsidiary in Spain to manufacture car parts and initial investment amount is 17,000,000. From this investment, the subsidiary expects 300,000 units of sales in the first year, which is expected to grow 10% for year 2 and 3,5% in year 4,4% in year 5 and remain the same in year 6 . Additionally, the subsidiary expects to sell those parts for 25 during the first three years of the project and for 30 in the following years. Variable manufacturing cost is 10 per unit during the first three years of the project and for 12 in the following years. The subsidiary will have 2,000,000 fixed costs each year, total depreciation expense of the project will be 9,000,000 and company uses straight line depreciation. The company expects to sell the investment for 8,000,000 after all taxes at the end of 6 years. For working capital, subsidiary will borrow 5,000,000 from a Spanish bank which is subject to 8% annual interest and will be transferred to the buyer of the project at the end of 6 years. The subsidiary is subject to 21% corporate tax, additionally, the firm will pay 15% withholding tax for remittances abroad except for capital transfers. Spot EUR/USD exchange rate is 1.08 and CFO of Global Trade Inc. expects the exchange rate to appreciate within the next 3 years by a normally distributed probability with 5% mean and 2% standard deviation each year, then, each year thereafter depreciate by a normally distributed probability with 3% mean and 1% standard deviation. Global Trade Inc. has $60 million worth of bonds outstanding with 7% annual coupon rate and 6% annual yield to maturity. The company's 40 million shares of common stock sell for $1.25 per share and have a beta of 1.5. The risk-free rate is 4%, and the market return is 10%. Tax rate is 21%. a. Calculate Net Present Value and Internal Rate of Return of the project from Global Trade Inc. perspective. b. Simulate NPV 500 times and calculate an approximate average NPV. Do you recommend this investment? c. Ignore CFO's exchange rate expectations and assume spot rate will remain the same for the next 6 years. Calculate the number of units that the company should sell for the project to have an IRR equal to company's cost of capital