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Panda Express has a store in EMU with a steady revenue of $ 5 million each year. The company believes the revenue will remain $
Panda Express has a store in EMU with a steady revenue of $ million each year. The company believes the revenue will remain $ million a year for the next three years if they keep the operations as it is now. However, the company is considering opening a new store in th street. The initial cost of opening the store is $ million and the projected revenue of the new store is $ million a year for the next three years. The companys analysts are estimating that the customers on the west side of the campus would stop coming to the EMU store and go to the new one. Therefore, they expect that $ million of the new store revenue will be the revenue shifted from the EMU store. Assuming the interest rate is is opening the new store a profitable project?
please solve using NPV equations with base estimates, worst case scenario, best case scenario
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