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8. You are trying to assess the value of a small retail store that is up for sale. The store generated a cash flow to
8. You are trying to assess the value of a small retail store that is up for sale. The store generated a cash flow to its owner of $ 100,000 in the most year of operation, and is expected to have growth of about 5% a year in perpetuity. a. If the rate of return required on this store is 10%, what would your assessment be of the value of the store? b. What would the growth rate need to be to justify a price of $ 2.5 million for this store?
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