Question
You have to pay $10,000 today for a full report on the potential earnings from your new Dunkin franchise location. If you decide to open
You have to pay $10,000 today for a full report on the potential earnings from your new Dunkin franchise location. If you decide to open it, you have to pay $150,000 today. In your first year, theres a 60% chance that youll earn $50,000 and a 40% chance that youll do great with marketing and earn $100,000. Your second year, youre guaranteed to earn $70,000. And in the third year, depending on the Boston Red Sox winning the Super Bowl, youll earn $120,000 if they win (20% chance) and $50,000 if they lose (80% chance). Should you take the project if interest is 7%?
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