we create the situation in which we assume that Toyota company export our electric car into the European market and after 5 years, they open 1st plant in Europe. in this we considered the currency fluctuation as well as the best situation in which the company makes more profit.

1. International
Finance
PROJECT PRESENTATION
Shubham Verma

2. PROJECT
€ 500.000.000

3. O 3 years project
O 2 problems:
- Fluctiation on the exchange rate €/ $
- Expected return of the investors
O Problem solving approach:
- 4 scenarios that allow us to get a MAX
and MIN for the NPV.

4. O NPV:
O Beta β
Damodaran = 1,01
High = 1,05
Low = 0,95
O Risk free rate
USA 10 years = 2,96%
O Premium market rate
USA = 5,08%
O Exchange rates euro/dollar
High point: 1,25 euro/dollar
Low point : 1,04 euro/dollar
O Cash flows
g= 1%
1= € 30.000.000
2= € 30.300.000
3= € 30.603.000

5. 1. Depreciation of US$ and high β

6. 2. Depreciation of US$ and low β

7. 3. Appreciation of US$ and high β

8. 4.Depreciation of US$ and low β

10. Recommendation: Short Call option contract to sell
Euro