Bailey, Kaylee, Haley, and Joyce are sorority sisters who have discovered an opportunity to purchase an Internet

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Bailey, Kaylee, Haley, and Joyce are sorority sisters who have discovered an opportunity to purchase an Internet café. Each of the women would have to put up $80,000 to make the purchase.

The revenue from the café is expected to remain constant at

$225,000 per year for the next several years. The costs (not including the opportunity costs of the investment) of operating the café are expected to remain constant at $185,000 for the next several years. The current market interest rate on enterprises with comparable risks is 9% per year. Should the four sorority sisters purchase the café? Explain.

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Principles Of Economics

ISBN: 9780593183540

10th Edition

Authors: Case, Karl E.;Oster, Sharon M.;Fair, Ray C

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