Present Value of Present Value of $1 Annuity of $1 Firm DFG plans topen a foreign subsidiary through which to sell its manufactured goods in the European market. It must decide between I cating the subsidiary in Country x or Country Z.the subsidiary operates in Country X. Its gross recelpts from sales will be subject to a 3 percent gross recolpts tax. If the subsidiary Income tax. Howover, Country Z's tax law has a special provision to attract foreign Investors: No foreign subsidlary is subject to the Income tax for the first three yoars of operations. In Country Z, Its net profits will be subject to a 42 percent DFG projects the following annual operating results for the two locatlons (In thousands of dollars). Use Appendix A and Appendx B Gross recelpts from sales Cost of sales 5110.08 (Ge.e0e) $110.009 $ 28.e0e $ 35.eee Net protit DFG projects that It will operate the foreign subsldlary for 10 years (years O through 9) and that the terminal value of the operation at the end of this period will be the same regardless of location. Assume a 5 percent discount rate a. Determine the NPV of Country X b. Determine the NPV of Country Z C. Which location maximizes the NPV of the foreign operation. Complete this question by entering your answers in the tabs below