•Study questions: 1.Compute the NPV of Ariel-Mexico in pesos. How should this NPV be translated into Euros? Assume expected future inflation for France is 3% pa. 2.Compute the NPV in Euros by translating the project’s future peso cash flows into Euros at expected future spot exchange rates. Note that Ariel’s Euro hurdle rate for a project of this type was 8%. Again, assume that annual inflation rates are expected to be 7% in Mexico and 3% in France. 3.Compare the two sets of calculations and the corresponding NPVs. How and why do they differ? Which approach should Arnaud Martin use? 4.Suppose Mexican inflation is projected at3% (assume French inflation remains at 3%). How does this affect the NPV calculations? 5.Suppose Ariel expects a …show more content…
CA4 sets the limit at 650 words (and a minimum of 250 words). And unlike earlier versions of the Common Application, the length limit will be enforced by the application form. No longer can applicants attach an essay that goes over the limit. Instead, applicants will need to enter the essay into a text box that counts words and prevents entering anything beyond 650 words.
You will find that some supplemental essays on the Common Application have different length guidelines, and many colleges that don't use the Common Application have a range of length requirements. No matter what the circumstances, make sure you follow the guidelines. If an essay should be 400 words, don't write 410. Learn more about some of the issues related to essay length in this article: College Application Essay Length Limits.
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Next, your are ready to start writing your actual essay. Your intro should not be more than three to four sentences; the purpose is for you to summarize your topic. For your introduction you need to have a good hook and a thesis
On February 22, 2016 author John Warner published an article on Just Visiting entitled “Kill the 5-Paragraph Essay.” Warner creatively talks about how rudimentary of a structure this type of essay holds. Writers are locked inside a cage of regulations and guidelines making them unable to write the essay as they please, but rather having to piece together regulated sentences and paragraphs because that’s what they have been told would score high on certain test questions. The article targets people of all kinds, but is more directed towards early college aged students. The purpose behind this article is to get them to expand their horizon, disregard all the regulations they have been previously taught and start to write in a much more open-minded sense.
The old factory needs extensive renovation which will still not leave it as efficient as the new factories planned for the new countries. Therefore, the NPV of the capital investments involved are equal for all three countries.
Foley contends that in addition to blocking discovery, the Five-Paragraph Essay formula squelches the student's authenticity. Foley states, "filling the structure with the requisite 500 words, they go through the motions of writing, but they seldom create something authentically theirs," (232). Foley knew that students feel much more at liberty to freely express themselves in their personal journals and in their letters to friends, but take on a different identity for the essay. The students' character, personality, and convictions are locked away until given the opportunity to free write.
Your essay should use a basic three-paragraph structure (introductory paragraph with a hook and a thesis, a supporting paragraph, and a concluding paragraph) and should be written in 12-point font with one-inch page margins.
Groupe Ariel SA of France is considering a project in Mexico. They need to analyze the net present value of the project, keeping in mind the exchange rates between Mexican Pesos and Euros in order to maximize their return. They also need to keep in mind the inflation rates over time and the risks involved with this type of investment.
So, the NPV can be calculated by taking the sum of present values of all the cash flows. This NPV comes out to be 3,703,176 Pesos. This NPV value can be converted into Euros by dividing the NPV value by the spot exchange rate. The spot exchange rate is 15.99 MXN/EURO. Hence, by dividing 3,703,176 by 15.99, NPV value in terms of Euro comes out to be 231,593 Euros.
2. Compute the NPV in Euros by translating the project's future peso cash flows into Euros at expected future spot exchange rates. Note that Groupe Ariel's Euro hurdle rate for a project of this type was 8%, assume that inflation rates are expected to be 7% in Mexico and 3% in France.
• Follow standard formatting. Your essay should be a minimum of 1000 words and a maximum of 1500 words, typewritten (Times New Roman, 12 point font), double-spaced with 1-inch margins. Acceptable citation style is Chicago (footnotes or endnotes). For additional information, go to
NPV calculated for this scenario comes out to be 231,507 Euros. The first thing required for calculating NPV in Euro is the forward premium. It is calculated by adding 1 to the inflation rates of France and Mexico
The relatively well posed project with promises of great future pay offs must be examined closely nevertheless to determine its true profitability. As such, the Super Project’s NPV must be calculated, however before we proceed we must acknowledge the relevant cash flows. The project incurred an expense of testing the market. This expense, however, must not be included in our cash flow analysis because it can be considered a sunk cost. This expense is required for ‘taking a temperature’ of the market and will not be recovered. Other sources of cash flow include:
You do not need to write whole paragraphs for any of the below sections. You simply need to write complete sentences that show the basic outline of your essay. Doing this will give you a guide when writing your rough draft.
1. Should Arauco build the Nueva Aldea project? (Hint: Estimate the project Net Present Value and provide a recommendation considering quantitative and qualitative arguments)
According to the IB Extended Essay IB guidelines, it states to not include ‘tables’ part of the 4,000-word count. For the reader of the essay, this essay is 3,999 words without the tables of the body included in the word count, following the Extended Essay IB guidelines.
Finally, in order to complete a more accurate comparison between the two projects, we utilized the EANPV as the deciding factor. Under current accepted financial practice, NPV is generally considered the most accurate method of predicting the performance of a potential project. The duration of the projects is different, one lasts four years and one lasts six years. To account for the variation in time frames for the projects and to further refine our selection we calculated the EANPV to compare performance on a yearly basis.