Jake took a 5-year $200,000 loan from the bank. Jake needs to nake 60 nonthly repayment with an amount of $3,800. The loan repayment will be paid by the end of each nonth. This package has an annual fee of $200. The package fee is paid on 30 June of each year during the following five-year period. The first one will be paid on 30 June 2020. This loan will be fully repaid by the end of 5 years. Rent will be paid by the end of each quarter with an amount of $12,000. Labour cost will be paid by the end of each month with an amount of $10,000. Maintenance cost will be paid by the end of each half year with an amount of $15,000. Jake predicts that this cafe franchise initially can have monthly revenue of $24,000. Assume that Jake can obtain this amount by the end of each month. Jake forecasts that this revenue amount will increase at the rate of y% p.a. The revenue increase will only happen at the beginning of each year. For example, this cafe franchise initially has monthly revenue of $24,000 in 2020. Then the revenue amount will become $24,000(1+y%) per month in 2021 and$24, 000(1 +y%)2 per month in 2022. Jake assumes the value of y is the same as the Australian CPI rate for 2019. CPI rate for 2019 was 1.6 The franchise has a term of 5 years. If Jake chooses not to renew the franchise, he needs to terminate this business by 31 December 2024. If Jake chooses not to renew the franchise, use the given information regarding costs and revenue to calculate Jake's effective yearly return rate (ji) over this five-year investment period. Jake took a 5-year $200,000 loan from the bank. Jake needs to nake 60 nonthly repayment with an amount of $3,800. The loan repayment will be paid by the end of each nonth. This package has an annual fee of $200. The package fee is paid on 30 June of each year during the following five-year period. The first one will be paid on 30 June 2020. This loan will be fully repaid by the end of 5 years. Rent will be paid by the end of each quarter with an amount of $12,000. Labour cost will be paid by the end of each month with an amount of $10,000. Maintenance cost will be paid by the end of each half year with an amount of $15,000. Jake predicts that this cafe franchise initially can have monthly revenue of $24,000. Assume that Jake can obtain this amount by the end of each month. Jake forecasts that this revenue amount will increase at the rate of y% p.a. The revenue increase will only happen at the beginning of each year. For example, this cafe franchise initially has monthly revenue of $24,000 in 2020. Then the revenue amount will become $24,000(1+y%) per month in 2021 and$24, 000(1 +y%)2 per month in 2022. Jake assumes the value of y is the same as the Australian CPI rate for 2019. CPI rate for 2019 was 1.6 The franchise has a term of 5 years. If Jake chooses not to renew the franchise, he needs to terminate this business by 31 December 2024. If Jake chooses not to renew the franchise, use the given information regarding costs and revenue to calculate Jake's effective yearly return rate (ji) over this five-year investment period
