Question Completion Status: QUESTION 15 Australian Automotive Group, an Australian company, is considering building a manufacturing plant in UK to expand its export market. The plant cost 140 million to build and will produce cash flows of E30 million, 35 million, 40 million, E45 millions in years 1, 2, 3 and 4, respectively. Other information is: Australian interest rate: 1.4% UK interest rate: 1.6% Spot rate 0.58/$ What is the NPV for the project denominated in AUD using the local currency approach? Please select the most suitable answer . Oa. $ 6,688,950 b.$ 6,560,916 C. $6,489,850 d. $ 6,335,689 QUESTION 16 Sigma Company, a US MNC is contemplating marking a foreign investment in Thailand. The initial cost of the project is THB100,000 The annual cash flows over the two-year economic life of the project in THB are estimated as 70,000 and 80,000. The parent firm's cost of capital in dollar is 8%. Long-run inflation is forecasted to be 3% p.a. in the US and 5% p.a. in Thailand. The current spot rate is THB/USD = 25.75. What is the THB equivalent cost of capital according to Fisher effect? Please select the most suitable option