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A business is for sale at $100,000. Discounting the expected cash inflows and expected cash outflows (except purchase price) at 12% yields an amount of
A business is for sale at $100,000. Discounting the expected cash inflows and expected cash outflows (except purchase price) at 12% yields an amount of $94,741. Based on this information, a. the minimum price you should pay for the business is $94,741 b. at a purchase price of $100,000, the business is projected to earn just a little more than 12% c. a higher discount rate would make this business opportunity more attractive d. the investment opportunity should be rejected if a 12% return is required
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