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Assume any possible missing information The company Administracion Financiera SA de CV is currently engaged in the sale of real estate, and has been offered

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Assume any possible missing information

The company Administracion Financiera SA de CV is currently engaged in the sale of real estate, and has been offered a piece of land with 100 hectares of salable area at a price of $200,000,000; The company estimates that the development and sale of the lots will take 2 years. In the first year the company estimates that it will spend $100,000,000 in urbanization expenses and $25,000,000 for sales expenses (commissions), and in the second year the expenses will be $90,000,000 for development expenses and $35,000,000 for commissions. According to the projections made by the company, revenues for the next 5 years are: Currently the company pays taxes at a rate of 30% The conditions for the purchase of the land are the following: pay $100,000,000 now and the rest in a term of 5 years, at an interest rate of 20% on unpaid balances (Traditional Form) Should the company acquire the subdivided land? What is the IRR of this project if the investment and financing decision are combined? 50\% stockholders' equity, 50% liabilities

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