How to affect the present value of the salvage value


Response to the following problem:

Explain how the present value of the salvage value of an Indonesian subsidiary will be affected (from the U.S. parent's perspective) by

(a) an increase in the risk of the foreign subsidiary and

(b) an expectation that Indonesia's currency (rupiah) will depreciate against the dollar over time.

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Financial Accounting: How to affect the present value of the salvage value
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