Kaplan Q 70 Pondhills

SCENARIO Pondhills Inc is a US multinational company with subsidiaries in the UK and Africa. The currency of the African country is pegged against the dollar, with a current exchange rate of 246.3 dinars/$US1. Due to political unrest led the finance director of Pondhills to become concerned about a possible devaluation of the dinar.and gets devalued 15% relative to the dollar during the next few months. Note (i) All sales from the African subsidiary are denominated in US dollars, and all receivables are therefore payable in dollars. (ii) 50% of payables are debts owned in sterling to the UK subsidiary by Ponda SA. (iii) Long-term loans are in dinars from an African bank, at an interest rate of 12% per annum. (iv) The cost of goods sold and other operating expenses (excluding interest) for Ponda SA are 70% of revenue. 40% of this is payable in dollars or sterling and 60% in dinars. (v) No significant changes in exchange rates are expected between the dollar and other major currencies. the question was to "Calculate the expected impact on the dollar value of Ponda SA’s annual cash flow in the first full year after devaluation. In the solution for finding annual cashflow after devaluation the current year revenue has been inflated by 1.15 %. I thought currency was getting devalued . so why is the revenue getting inflated by the same percentage. Solution per text Current dinars post devaluation dinar current dollars post dev.$ Rev 2300 2645 9.338 9.338 Sorry for having to copy the question because as far as i remember BPP is the Text book u usually refer too and u have previously mentioned that u dnt have Kplan text so i had to post the question here.Inconvenience regretted.