. Intro Cargill is a U.S. firms producing cattle feed. It imports soy beans from Brazil and also sell some products there. The company expects the following cash flows: U.S. sales of $340 million U.S. cost of goods sold of $68 million U.S. interest expenses of $30 million Selling, general and administrative expenses of $20 million Brazilian sales of R$160 million Brazilian cost of goods sold of R$640 million Brazilian Iterest expenses of R$10 million . . The company expects the Brazilian real exchange rate to take on one of three possible values: $0.27 per real, $0.29 per real, or $0.31 per real. Part 1 1 Attempt 1/10 for 10 pts. What is the cash flow before taxes if the exchange rate turns out to be $0.31 per euro (in $ million)? 70.1 Correct All numbers in million, except exchange rates R$ = $0.27 R$ = $0.29 R$ = $0.31 $340 $43.2 $383.2 $340 $46.4 $386.4 $340 $49.6 $389.6 Exchange rate scenario Sales U.S. sales Brazilian sales (R$ 160) Total sales Costs & expenses U.S. costs Brazilian costs (R$640) Total costs Expenses Interest expenses U.S. interest expenses Real interest expenses (R$10) Total interest expenses Cash flow before taxes $68 $172.8 $240.8 $20 $68 $185.6 $253.6 $20 $68 $198.4 $266.4 $20 $30 $2.7 $32.7 $89.7 $30 $2.9 $32.9 $79.9 $30 $3.1 $33.1 $70.1 - Attempt 4/5 for 7 pts. Part 2 What could the company do to reduce its economic exposure to the real? Check all that apply: Increase imports from Brazil Restructure debt to increase debt payments in real Hedge its euro transactions Increase sales in Brazil Submit Try again . Part 3 - Attempt 1/10 for 10 pts. The company decided to restructure its business to reduce its exposure to the real exchange rate. In particular, the company decided to do the following: Increase sales efforts to reach Brazilian cattle farmers, increasing real sales to 208 million, while also increasing selling expenses to $25. Buy more soy beans in America, reducing Brazilian cost of goods sold to 620 million and increasing U.S. cost of goods sold to $74 million. Borrow more dollars to pay off some real debt, decreasing real interest expenses to 5 milion and increasing dollar interest expenses to $31.45 million. . What is the cash flow before taxes if the exchange rate turns out to be $0.31 per euro (in $ million)? + decimals Submit