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To the extent that the two approaches give you different answers in (5), which approach should you rely on? That is, should the real appreciation

 To the extent that the two approaches give you different answers in (5), which approach should you rely on? That is, should the real appreciation or depreciation of foreign currencies affect your capital budgeting decision? Briefly justify your answer. Note: You should revise your per-unit direct labor costs, per-unit direct material costs, and total overhead costs of both the existing equipment and the new machine to reflect the 3% inflation rate. Currently, the costs are projected to grow at 7% inflation rate. You also have to revise your MXN discount rate for the approach in (2) because now the two currencies have the same expected inflation rates. Hint: The true value of a project should equal the price at which you can sell the project's incremental cash flows to a third-party buyer today

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