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A restaurant that had been owned by a family for 20 years was to be sold. The flow last year was $2,000,000 and the capitalization

A restaurant that had been owned by a family for 20 years was to be sold.

The flow last year was $2,000,000 and the capitalization rate for this type of restaurant in this area was 8.5%.

  1. Calculate the current value of the restaurant
  2. If the owners wants to sell for $25,000,000, by how much must they increase the cash flow?

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