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Ally owns a chain of bakery stores. He is considering whether he should build a new store downtown. The expected rate of return is 15%

Ally owns a chain of bakery stores. He is considering whether he should build

a new store downtown. The expected rate of return is 15% per year, while the

cost of borrowing money to finance the project is 12% per year. Should Ally

proceed with this project? Provide justification to your answer.

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