There is a Swedish subsidiary (Swedish SC) of a European firm. Swedish SC sells 7 million units, of which 3 million are sold at home and 4 million are exported, all units at krone (Kr) 17 per unit. The firm has fixed overhead costs of Kr 8 million and variable costs (labor, raw material, etc.) of Kr 12 per unit. The firm has a straight line depreciation of Kr 2 million each year and the firm has a tax rate of 20%.

The present rate is 0.90 / krone but as a result of sudden depreciation of Krone from 0.90 / krone to 0.80 / krone, prices at home increase to Kr 18 / unit) but increase to Kr 20 / unit in the export market. Costs however remain same as before.

Find the Cash flows in post-depreciation of Krone?

a. 8million

b.None of the given choices

c. 25.60million

d. 27.20 million