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10 pts Question 5 Bonnie has the opportunity to purchase a large Victorian home for $650,000. She will need to spend additional $125,000 to renovate

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10 pts Question 5 Bonnie has the opportunity to purchase a large Victorian home for $650,000. She will need to spend additional $125,000 to renovate and convert to a bed and breakfast. She estimates the following after tax cashflows. Year 6 cashflow includes the terminal value of the venture. a. The Payback period of the venture is years (round to the nearest year). b. If Bonnie desired payback period is less than 3 years, Bonnie will (accept/reject) the venture Year 1 2 3 Cash-flows 80,000 90,000 105,000 112.000 126,000 1,050,000 4 5 6

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