Chapter 1 Valuation model:

Example: Livingston co. has a subsidiary in Korea. The subsidiary re-invests half of
its net cash flow into operations and remits half to the parent company. Livingston’s
expected cash flow from domestic business is $100,000 and the Korean sub is
expected to generate 100 million won. The expected value of won is $0.0012.
What is the expected dollar cash flow of Livingston co?

Answer: Addition to the all cash flows. We have domestic dollar cash flow and we
have Korean won cash flow. We can not add different currencies.

= $100,000
+ (100,000,000 * 0.0012)/2
=$160,000