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Helga is considering the purchase of a small restaurant. The purchase price listed by the seller is $880,000. Helga has used past financial information to
Helga is considering the purchase of a small restaurant. The purchase price listed by the seller is $880,000. Helga has used past financial information to estimate that the net cash flows (cash inflows less cash outflows) generated by the restaurant would be as follows: If purchased, the restaurant would be held for 10 years and then sold for an estimated $780,000. Requlred: Determine the present value, assuming that Helga desires a 10% rate of return on this investment. (Assume that all cash flows occur at the end of the year.) Note: Do not round Intermedlate calculatlons. Round your flnal answers to nearest whole dollar amount. Use tables, Excel, or a flnanclel calculator. (FV of $1. PV of $1. FVA of $1. PVA of $1. FVAD of $1 and PVAD of $1 )
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