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Suppose that you are the owner of a hypothetical firm that sells water on the beach during weekends. You stock $ 1 , 0 0

Suppose that you are the owner of a hypothetical firm that sells water on the beach during weekends. You stock $1,000 of inventory each night before operating (i.e., on Friday and Saturday nights) and sell your entire inventory for $2,000 revenue during each day (on Saturday and Sunday). Assume that only 50% of your inventory must be paid for in cash when stocked (in periods 0 and 1) with the remaining 50% of your inventory not paid back until you sell the product (i.e., you create an account payable equal to 50% of inventory that is due at the end of each operating day), and you hire labor to sell the water for $50 per day (in periods 1 and 2). Assuming a 20% tax rate, what is your firm's free cash flow on Sunday (period 2)?

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