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Investment up front is 1 mEUR, Cash flow after year 1 is 300 kEUR, in year 2 it is 350 kEUR, in year 3 it
Investment up front is 1 mEUR, Cash flow after year 1 is 300 kEUR, in year 2 it is 350 kEUR, in year 3 it is 200 kEUR. The cash flows are expected to grow by 4% after that. After year 5, 400 kEUR of the investment may be expropriated, with a 45% probability. The appropriate discount rate is 8%, and the exchange rate is 1.1 USD/EUR. What is the NPV in USD?
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