Should the company go ahead with either project?

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? explain your answer in detail and provide in-text citations.

Part B:

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