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At the end of 2014, a Eurozone firm considers an investment project that produces a certain product in the Eurozone and exports to Switzerland. The firm's cost of capital is 10% and the firm uses this as its discount rate for the proposed investment. The initial investment and free cash flows for subsequent years (a horizon of five years) are presented in the table below .

On January 15, 2015, the Swiss National Bank removed the exchange rate cap and the exchange rate changed from Sfr1.20/ to Sfr1.00/. The exchange rate is expected to stay at the new level for the investment horizon. The exchange rate change does not affect cash flows in Swiss franc but does affect the conversion from Swiss franc cash flows to euro cash flows. Which of the following statement addresses correctly the effect of the exchange rate change on the firm's capital budgeting?

a. NPV is positive both before and after the exchange rate change.

b. NPV is negative both before and after the exchange rate change.

c. NPV is positive before the exchange rate change but turns negative after the exchange rate change.

d. NPV is negative before the exchange rate change but turns positive after the exchange rate change.

0 1 2 3 4 5 Swiss franc cash flow 120 120 120 120 120 1.2 1.2 1.2 1.2 | 1.2 Exchange rate (Sfr/Euro) Euro cash flows 1.2 100 | -400 | 100 | 100 | 100 | 100 |

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