Carpet Baggers Inc. is proposing to construct a new bagging plant in a country in Europe. The two prime candidates are Germany and Switzerland. The forecasted cash flows from the proposed plants are as follows:
C0
C1
C2
C3
C4
C5
C6
IRR (%)
Germany (Millions of Euros)
-60
+10
+15
+15
+20
+20
+20
15.0%
Switzerland (Millions of Euros)
-120
+20
+30
+30
+35
+35
+35
12.8%
The spot exchange rate for euros is $1.3/€, while the rate for Swiss francs is CHF 1.5/$. The interest rate is 5% in the United States, 4% in Switzerland, and 6% in the euro countries. The financial manager has suggested that, if the cash flows were stated in dollars, a return in excess of 10% would be acceptable.
Should the company go ahead with either project? If it must choose between them, which should it take?
Please explain your answer in detail and provide in-text citations.
Part B:
please prepare a professional PowerPoint presentation summarizing your findings for Part A. The presentation will consist of your major findings, analysis, and recommendations in a concise presentation of 18 slides (minimum). An agenda, executive summary, and references slides should also be included
