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Suite Enterprises is a large restaurant supply firm that dominates the local market. It does, however, have one main rival; Loew Supplies. Because of
Suite Enterprises is a large restaurant supply firm that dominates the local market. It does, however, have one main rival; Loew Supplies. Because of this competition, Suite earns a profit of $ 1240 per year. It could however, cut its prices to cost, earn zero profits for 1 years and drive Loew out of the market. If it does so, Suite will start earning $ 1278 in 2 years to oc. The interest rate is 5 % per annum. What is the present value of Suite's profit stream if it does not cut its prices What is the present value of Suite's profit stream if it does cut its prices Does it pay Suite to cut its profits Cyes Ono
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