Question
Assuming that the specific yield of 1,500 kWH in the prospectus is correct, you would be willing to pay up to 10.5 million Euros for
Assuming that the specific yield of 1,500 kWH in the prospectus is correct, you would be willing to pay up to 10.5 million Euros for the park (walk away price). Your target price is 9.7 million euros. Want 8 to 11 IRR.
However, there is still a third-party report that might claim the yield below 1,500. You believe that for each percent below 1,500 that a third-party estimates, the sales price should decrease 1.2 percent in order to keep the rate of return equal.
With this information can you construct an equation that gives you an accurate sales price if the third-party estimates the park below 1,500kWH?
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