What is the npv of this investment is this investment a


You have an investment opportunity in Japan. It requires an investment of 1.00 million today and will produce a cash flow of yen ¥114 million in one year with no risk. Suppose the risk-free interest rate in the United States is 4.0%, the risk-free interest rate in Japan is 2.0%,and the current competitive exchange rate is yen ¥110 per dollar.

  • What is the NPV of this investment?
  • Is this investment a good opportunity?

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Finance Basics: What is the npv of this investment is this investment a
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