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Suppose you borrow $43031.75M when financing a gym with a cost of $88067.51M. You expect to generate a cash flow of $53941.81M at the end
Suppose you borrow $43031.75M when financing a gym with a cost of $88067.51M. You expect to generate a cash flow of $53941.81M at the end of the year if demand is weak, $86714.79M if demand is as expected and $123444.28M if demand is strong. Each scenario is equally likely. The current risk-free interest rate is 4.24% (risk of debt) and there's a 10.43% risk premium for the risk of the assets. What would be the realized return of equity if the demand is strong?
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