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You have an investment opportunity in Japan. It requires an investment of $ 1.03$1.03 million today and will produce a cash flow of yen 121121
You have an investment opportunity in Japan. It requires an investment of $ 1.03$1.03 million today and will produce a cash flow of yen 121121 million in one year with no risk. Suppose the risk-free interest rate in the United States is 4.3 %4.3%, the risk-free interest rate in Japan is 1.9 %1.9%, and the current competitive exchange rate is yen 110110 per dollar. What is the NPV of this investment? Is it a good opportunity?\
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