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A mall operator has the opportunity to lease an additional 20,000 square feet of space for the next five years. It can divide up this

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A mall operator has the opportunity to lease an additional 20,000 square feet of space for the next five years. It can divide up this space between the following potential new tenants. Each tenant will require a different amount of space, and each opportunity represents a different level of NPV, as indicated. The discount rate is 10% for all options. The mall operator's objective is to maximize NPV. Store NPV Pet Store Fabric Store Book Store Luggage Store Hardware Store Walch Store Shoe Repair Store S600.000 $1,000,000 $320.000 5600 ODD 5900 000 $310.000 $30,000 Space Required (Sq. Feet) 6.000 7,000 4,000 5,000 6.000 2.000 1,000 Question A: 15 points) Assuming the amount of additional space available for lease is limited to 20,000 square feet, which of the above projects should the mall operator accept FIRST? In other words, which of the above projects is MOST attractive? O A. Hardware Store OB. Shoe Repair Store OC. Put Store OD. Watch Store O E. Luggage Store Question B: (5 points) What is the TOTAL NPV created if the mall operator chooses the optimal combination of stores for its expansion? OA. 52 810,000 OB. $1,000,000 OC. 52.210,000 OD S3,130,000 O E. $3.760,000 A mall operator has the opportunity to lease an additional 20,000 square feet of space for the next five years. It can divide up this space between the following potential new tenants. Each tenant will require a different amount of space, and each opportunity represents a different level of NPV, as indicated. The discount rate is 10% for all options. The mall operator's objective is to maximize NPV. Store NPV Pet Store Fabric Store Book Store Luggage Store Hardware Store Walch Store Shoe Repair Store S600.000 $1,000,000 $320.000 5600 ODD 5900 000 $310.000 $30,000 Space Required (Sq. Feet) 6.000 7,000 4,000 5,000 6.000 2.000 1,000 Question A: 15 points) Assuming the amount of additional space available for lease is limited to 20,000 square feet, which of the above projects should the mall operator accept FIRST? In other words, which of the above projects is MOST attractive? O A. Hardware Store OB. Shoe Repair Store OC. Put Store OD. Watch Store O E. Luggage Store Question B: (5 points) What is the TOTAL NPV created if the mall operator chooses the optimal combination of stores for its expansion? OA. 52 810,000 OB. $1,000,000 OC. 52.210,000 OD S3,130,000 O E. $3.760,000

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