You are evaluating a proposed expansion of an existing subsidiary located in Switzerland. The cost of the expansion would be CHF 16.7 million. The cash flows from the project would be CHF 4.7 million per year for the next five years. The Canadian dollar required return is 12% per year, and the current exchange rate is CHF 1.09/CAD. The going rate on EuroCanadian is 5% per year. It is 4% per year on Euroswiss.

b. Convert the projected franc flows into dollar flows and calculate the NPV. (Enter the answer in dollars, not in millions of dollars. Do not round intermediate calculations. Round the final answer to 2 decimal places.

NPV $

c-1. What is the required return on franc flows? (Do not round intermediate calculations. Round the final answer to 2 decimal places.)

Return on franc flows %

c-2. What is the NPV of the project in Swiss francs? (Enter the answer in francs, not in millions of francs. Round the final answer to 2 decimal places. Do not round intermediate calculations.

NPV CHF

c-3. What is the NPV in dollars if you convert the franc NPV to dollars? (Enter the answer in dollars, not in millions of dollars. Round the final answer to 2 decimal places. Do not round intermediate calculations.

NPV $