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Lawson is a UK based wine and spirits company. It seeks to create a fine wine division to enhance its portfolio of global properties. The
Lawson is a UK based wine and spirits company. It seeks to create a fine wine division to enhance its portfolio of global properties. The CFO is scrutinizing a proposal to make an investment in a vineyard in Chile. It requires the purchase of acres of vineyards in the Maipo valley and setting up the requisite infrastructure for processing grapes and bottling wine. The project is expected to last years after which an exit through sale to a local affiliate is assumed. The table below lists the cash flows denominated in the Chilean Peso CLP Assume a spot rate GBPCLP
tableTimeCash Flow CLP millions
The appropriate CLP discount rate for projects of this nature is What is project NPV in CLP
A $ CLP mil
B $ CLP mil
C $ CLP mil
D $ CLP mil
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