In five years, Kent Duncan will retire. He is exploring the possibility of opening a self-service car wash. The car wash could be managed in the free time he has available from his regular occupation, and it could be closed easily when he retires. After careful study, Mr. Duncan has determined the following a. A building in which a car wash could be installed is available under a five-year lease at a cost of $5,300 b. Purchase and installation costs of equipment would total $190,000. In five years the equipment could be c. An investment of an additional $9,000 would be required to cover working capital needs for cleaning per month sold for about 10% of its original cost supplies, change funds, and so forth. After five years, this working capital would be released for d. Both a wash and a vacuum service would be offered with a wash costing $1.25 and the vacuum costing e. The only variable costs associated with the operation would be 7.5 cents per wash for water and 10 f. In addition to rent, monthly costs of operation would be: cleaning, $3,800; insurance, $75; and e. Gross receipts from the wash would be about $4,000 per week. According to the experience of other car investment elsewhere $.55 per use cents p maintenance, $1,895 washes, 60% of the customers using the wash would also use the vacuum. er use of the vacuum for electricity Mr. Duncan will not open the car wash unless it provides at least a 11% return