Vandelay corporation presently has an existing business in singapore but is considering an additional plant there. The following information has been gathered to assess this project. The initial investment required is SGD million. The current spot rate is The project will be terminated at the end of Year 2, when the subsidiary will be sold. Vandelay is planning on taking a SGD 2.0 million loan from singapore banking system for 5 years. The interest on the loan is 14% and the annual interest expense is SGD 280,000. The principal amount will be repaid end of the term as a lump sum. Also assume that SG subsidiary will not require any additional working capital. The price, demand, and variable cost of the product in the Singapore are as follows. The exchange rate is forecasted to be 71 USD/SGD at the end of Year 1 and 70 USED/SGD at the end of year 2. The fixed costs, such as the overhead expenses are estimated to be SGD 1.3 million each year. The fixed costs such as the overhead expenses, are estimated to be SGD 1.3 million each year. The Singapore government will impose an income tax of 20% on income. In addition, Singapore also imposes 20% withholding tax on all remittance to foreign country. The annual depreciation expense is 15% of initial outlay. In two years the subsidiary is to be sold. Vandelay expects to receive SGD. 1.5 million on which is subject Vandelay required a 12% rate of return on this project. a) Calculate the NPV & IRR from the perspective of the subsidiary. b) Calculate the NPV & IRR from the perceptive of the parent. C) Should Vandelay accept this project? It not explain what could the parent company do