Your firm is based in southern Ireland (and thereby operates in euro, not pounds) and is considering an investment in the United States.

The project involves selling widgets: you project a sales volume of 50,000 widgets per year, sales price of $20 per widget with a contribution margin of $15 per widget.
The project will last for 5 years, require an investment of $1,000,000 at time zero (which will be depreciated straight-line to $10,000 over the 5 years). The salvage value for the equipment is projected to be $10,000. The project will operate in rented quarters: $300,000 rent is due at the start of each year.
The corporate tax rate is 12½ percent in Ireland and 40 percent in the U.S.
For simplicity, assume that taxes are paid like sales taxes: immediately.
The spot exchange rate is $1.50 = €1.00. The cost of capital to the Irish firm for a domestic project of this risk is 8 percent. The U.S. risk-free rate is 3 percent; the Irish risk-free rate is 2 percent.

1) What is CF0 in dollars? (Initial Outlay)

2) What is CF1 in dollars? (Annual incremental free cash flow)

3) What is CF5 in dollars? (Terminal cash flow)

4) What is the NPV of the U.S.-based project to the Irish firm?

5) What is the dollar-denominated IRR?

6) What is the euro-denominated IRR according to PPP (Purchasing Power Parity)?