11. Home Builder Supply, a retailer in the home improvement industry, currently operates seven retail outlets in Georgia and South Carolina. Management is contemplating building an eighth retail store across town most successful retail outlet. The company already owns land for this store, which currently warehouse located on it. Last month, the marketing departm from its ent spent $10,000 on market research to determine the extent of customer demand for the new store. Now Home Builder Supply must decide whether to build and open the new store. Which of the following should be included as part of the incremental earnings for the proposed new retail store? (30 points) Positive/Negative/ No Effect Name The original purchase price of the land where the store will be located The cost of demolishing the abandoned warehouse and clearing the lot. The $10,000 in market research to evaluate customer demand. Construction costs for the new store. The value of the land if sold Interest expense on the debt borrowed to pay the construction cost. The loss of sales in the existing retail outlet, if customers who previously drove across town to shop at the existing outlet become customers of the new store instead ll eeuity firm with a beta of 0.80. The return to market portfolio is 8% and the risk free rate 11. Home Builder Supply, a retailer in the home improvement industry, currently operates seven retail outlets in Georgia and South Carolina. Management is contemplating building an eighth retail store across town most successful retail outlet. The company already owns land for this store, which currently warehouse located on it. Last month, the marketing departm from its ent spent $10,000 on market research to determine the extent of customer demand for the new store. Now Home Builder Supply must decide whether to build and open the new store. Which of the following should be included as part of the incremental earnings for the proposed new retail store? (30 points) Positive/Negative/ No Effect Name The original purchase price of the land where the store will be located The cost of demolishing the abandoned warehouse and clearing the lot. The $10,000 in market research to evaluate customer demand. Construction costs for the new store. The value of the land if sold Interest expense on the debt borrowed to pay the construction cost. The loss of sales in the existing retail outlet, if customers who previously drove across town to shop at the existing outlet become customers of the new store instead ll eeuity firm with a beta of 0.80. The return to market portfolio is 8% and the risk free rate
