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Miss Cookie Jams, a manufacturer of confectionaries, wants to increase its market share. In order to do so , Miss Cookie Jams has decided to
Miss Cookie Jams, a manufacturer of confectionaries, wants to increase its market share. In order to do so Miss Cookie Jams has decided to locate a new factory along the east coast. Miss Cookie Jams will either buy or lease a site depending upon which is more advantageous. The site location committee has narrowed down the available sites to the following three very similar buildings that will meet their needs. Building A: Purchase for a cash price of $ useful life years. Building B: Lease for years with annual lease payments of $ being made at the beginning of the year Building C: Purchase for $ cash, and due to the building being larger than needed, the excess space can be sublet for years at a net annual rental of $ Rental payments will be received at the end of each year. Miss Cookie Jams has no aversion to being a landlord... Which building would be reccomended for Miss Cookie Jams to locate? Assuming a cost of funds? Calculate the Net Present Value for each.
Miss Cookie Jams, a manufacturer of confectionaries, wants to increase its market share. In order to do so Miss Cookie Jams has decided to locate a new factory along the east coast. Miss Cookie Jams will either buy or lease a site depending upon which is more advantageous. The site location committee has narrowed down the available sites to the following three very similar buildings that will meet their needs.
Building A: Purchase for a cash price of $ useful life years.
Building B: Lease for years with annual lease payments of $ being made at the beginning of the year
Building C: Purchase for $ cash, and due to the building being larger than needed, the excess space can be sublet for years at a net annual rental of $ Rental payments will be received at the end of each year. Miss Cookie Jams has no aversion to being a landlord...
Which building would be reccomended for Miss Cookie Jams to locate? Assuming a cost of funds?
Calculate the Net Present Value for each.
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