You ane the viseer of the local record wrore, and you are considering opening a coffee shop in a vacant area in the buck. of the store. Yoe estimate that it will cost you $50,000 to set up the store and that you will generate $12,900 in affer. tas cast flows for the life of the store (which is expected to be 8 years.) The one concern you have is that you have furated parking, by opening the coffee shop you run the risk of not having enough parking for customers who thop af Your record atare. You estimate that the lost sales would amount to $5,500 per year and that your after-tax operaing earyie on sles at the record store is 45\%. If your discount rate is 10%, what is the NPV of opening the coffee shop? 54.416 $652 $815 $2,119 +$385 Page 26 of 29