George is interested in buying one of the two local businesses on sale: a Coffee Shop or a Shoe Store. The initial investment for Coffee Shop is $115,000 and $135,000 for Shoe Store Cash flow in the first year Coffee Shop is $7,000 and $9,000 for Shoe Store Assume that both businesses can be operated forever Cash flows grow at 5.00% for Coffee Shop and 3.00% for Shoe Store George can borrow from a bank at a rate of 8.00% to buy Coffee Shop and 7.00% to buy Shoe Store

If George buys the Coffee Shop instead of Shoe Store, How much extra NPV will he get? Enter your answer in the following format: + or - 12,345. Hint1: Answer is between 26,067 and 31,733 Hint2: Compute NPV(Coffee Shop) - NPV (Shoe Store).