Question 7 1 pts A US corporation has a foreign subsidiary. The subsidiary (based in the United Kingdom) of ACME company will earn 3.5 pounds of dividends per share. The dollar-pound exchange rate at the end of the year is expected to be $1.43 per pound, and the pound is expected to appreciate 2% against the dollar each year for an indefinite period. The dividend (in pounds) is expected to grow at 3% a year indefinitely. First, find the growth rate of dividends after adjusting for currency effects. What is the value in millions of dollars of its equity ownership of the subsidiary (use the dividend discount model and total shares)? Assume a cost of equity capital of 10% for the subsidiary and a total of 15 million shares outstanding. 1612 1576 1453 O 1533 O 1497