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Value an umbrella stand that sells 50 umbrellas when it is rainy and 0 when not. The probability of rain is 0.3. There are 365
Value an umbrella stand that sells 50 umbrellas when it is rainy and 0 when not. The probability of rain is 0.3. There are 365 days per year. Each umbrella sells for $5 and costs $1 to make. The business lasts 2 years and the weighted average cost of capital is 10% per year. Calculate the discounted cash flow and show all work.
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