The corporate tax rate for a company head office is 27%. The corporate tax rate for a subsidiary in Narnia is 20%. Narnia has a thin-cap. regulation that requires at least a third of funding for the subsidiary comes from equity. How would you fund the subsidiary from head-office?
1. Calculate the following cross rates a. The 8/F rate given 1.3874 $/€ and 110 F/$ b. The CHF/€ rate given 1.3874 $/8 and 0.9148 CHF/$ c. The €/f rate given 1.3874 $/€ and 1.1807 $/€ d. The AUD/CHF rate given 0.9151 CHF/$ and 1.3620 AUD/$ 2. Given Forward Rate is CHF1.50/USD, iusn = 4.2%, […]