You are evaluating a proposed expansion of an existing subsidiary located in Switzerland. The cost of the expansion would be SF 16 million. The cash flows from the project would be SF 4.8 million per year for the next five years. The dollar required return is 14 percent per year, and the current exchange rate is SF 1.05. The U.S. risk-free interest rate is 4 percent per year. It is 3 percent per year in Switzerland. Calculate the NPV in dollars using the home currency approach (use approximate, not exact, relationships when solving this problem). You must show work to get full credit. xvi. a. $455,989.19 b. $478,788.65 c. $680,749.35 d. $882,710.06 e. $895,752.40 How will the answer change if the exchange rate suddenly increases? Why? 125.5 0eta 160 A SELECE 09.0 02,12 o