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MBA,MCS,M.phil
Devry University
Jan-2008 - Jan-2011
MBA,MCS,M.Phil
Devry University
Feb-2000 - Jan-2004
Regional Manager
Abercrombie & Fitch.
Mar-2005 - Nov-2010
Regional Manager
Abercrombie & Fitch.
Jan-2005 - Jan-2008
Lakonishok Equipment has an investment opportunity in Europe. The project costs 12 million and is expected to produce cash fl ows of 2.7 million in year 1, 3.5 million in year 2, and 3.3 million in year 3. The current spot exchange rate is $1.22/ and the current risk-free rate in the United States is 4.8 percent, compared to that in Europe of 4.1 percent. The appropriate discount rate for the project is estimated to be 13 percent, the U.S. cost of capital for the company. In addition, the subsidiary can be sold at the end of three years for an estimated 7.4 million. What is the NPV of the project?
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