Answered step by step
Verified Expert Solution
Question
1 Approved Answer
You are planning to acquire a business today and will sell it in 3 years to try and make a profit. It will cost you
You are planning to acquire a business today and will sell it in 3 years to try and make a profit. It will cost you 125,085 dollars today (year zero) to purchase the business. The future cash flows associated with this investment are: an expense of 34,738 dollars at the end of year 1; an inflow of 27,033 dollars at the end of year 2 ; and an inflow of 36,462 dollars at the end of year 3. In addition, you expect to sell the business for 394,596 dollars at the end of year 3. If the MARR (Minimum Acceptable Rate of Return) is 9% per year, compounded annually, what is the annual worth of this investment? (note: round your answer to two decimal places; do not include spaces or dollar signs.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started