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Two young entrepreneurs want to invest $210,000 in a restaurant. Their business plan shows that the restaurant will generate the following cash flows: Year Cashflow
Two young entrepreneurs want to invest $210,000 in a restaurant. Their business plan shows that the restaurant will generate the following cash flows: Year Cashflow 10,000 15,000 40,000 4 45,000 5 55,000 6 60,000 7 65,000 8 70,000 9 75,000 10 80,000 They want to earn at least 14% return They also would like to have their initial investment recovered within 5 Based on the information above, claculate the following: Q1 What is the present value? Q2 What is the net present value? Q3 What is the payback period? Q4 Should these entrepreneurs proceed with this investment? 2889 Q2 Q3 Q4 1 2 3 Use Interest Rate Table to solve for asnwering Q1 years Rubrics Il marks I mark 1 mark 2 marks 15 marks Year Cashflow 1 $ 10,000 2 $ 15,000 3 $ 40,000 4 $ 45,000 5 $ 55,000 6 $ 60,000 7 $ 65,000 8 $ 70,000 9 $ 75,000 10 $ 80,000 to earn at least 14% return would like to have their initial investment recovered within Based on the information above, claculate the following: Q1 What is the present value? Q2 What is the net present value? Q3 What is the payback period? Q4 Should these entrepreneurs proceed with this investment? Use Interest Rate Table to solve for asnwering Q1 5 years Rubrics 11 marks I mark I mark 2 marks 15 marks
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