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Q3. (10 marks) Mark Stevens is considering opening a hobby and craft store. He would need $120,000 to equip the business and another $50,000 working

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Q3. (10 marks) Mark Stevens is considering opening a hobby and craft store. He would need $120,000 to equip the business and another $50,000 working capital needs. Mark estimates that the annual cash inflow from the business will amount to $90,000. Annual cash outflow for operating costs will amount to $30,000. Mark plans to operate the business for only six years. He estimates that the equipment could be sold at that time for 10% of their original cost. The working capital will be fully released for other purposes at the end of the six years, Mark. uses a discount rate of 12% Required: Would you advise Mark to make this investment? Use the net present value method to deterinine if in a positive balance

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