market l of busin buildin line ba entire is estir 6 TIME Invest now Invest in one year -200 50 100 100 100 100 100 -400 150 150 150 150 150 If the cost of capital is 10%, should IBM invest now or postpone and invest in one year? years A8/ (Abandonment) Five years ago, your firm installed a quick-lube store on Connolly Avenue. Southwest Cellular would like your store to convert to one of its own outlets. They have made you an offer that nets you $600,000 after taxes. Your required return is 12%. a. You expect $75,000 cash flow after tax for the next 10 years. Should you abandon? b. Assume your annual cash flow is $120,000, What is the minimum offer you would accept? costs year i inver com spon retu A9. (Abandonment) Seven years ago, your firm started a car wash on Third Street. Exxon ould like to convert the car wash to a gas station. They have made you an offer that B2. (Inc Mobil w