YOUR U.S.-BASED FIRM IS CONSIDERING A CAPITAL BUDGETING PROJECT IN...

16. - BT THANH TOAN QUOC TE MULTINATIONAL FINANCIAL MANAGEMENT DAP AN
BT THANH TOAN QUOC TE MULTINATIONAL FINANCIAL MANAGEMENT DAP AN
16. Your U.S.-based firm is considering a capital budgeting project in Japan. Suppose that the spot exchange rate for Japanese yen is ¥122/$ and that the one year forward exchange rate for Japanese yen is ¥130/$. The discount rate is 5% in the U.S. What's the discount rate that should be used in Japan on yen-denominated cash flows? a. 11.89% b. 6.56% c. 3.28% d. 1.67% e. None of the above