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Please answer the question with the following updates in the question: You wish stay ahead of inflation rate, which is 3% PROBLEM B. (24 Points)
Please answer the question with the following updates in the question: You wish stay ahead of inflation rate, which is 3%
PROBLEM B. (24 Points) You wish to purchase a Five Guys Restaurant in 2023. The investor (you) just wish to stay ahead of the rate of inflation which is 3%. You will need $30,000 to pay for the business assets/inventory and $20,000 of net-working capital. This is a three-year investment. At the end of three years, however, you can sell the existing inventory for $5,000.00 and will no longer need to utilize the net working capital. You anticipate the cashflow at the end of year one to be $8,000.00; the end of year two to be $12,000 and the end of year 3 to be $16,000. Question B1: Using the anticipated cash flows from Five Guys Restaurant tell me if it is a good investment and calculate the following. (Show your work) 1. the NPV 2. Payback period using years and monthsStep by Step Solution
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