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Given: A group of entrepreneurs is considering the purchase of an online business. Firm A predicts that it will bring in a constant revenue stream
Given: A group of entrepreneurs is considering the purchase of an online business. Firm A predicts that it will bring in a constant revenue stream of $80,000 per year for 10yr. Firm B predicts that it will bring in a constant revenue stream of $95,000 for 8yr. Based on a comparison of accumulated present values, which firm is the better buy, assuming the interest rate is 4.1%, compounded continuously, and both firms have the same purchase price? Find: Based on a comparison of accumulated present values, which firm is the better buy, assuming the interest rate is 4.1%, compounded continuously, and both firms have the same purchase price
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