You want to start a new business and you know it needs R200 000 which you borrow at an annual rate of K. The first 6 years of running the business yields a steady profit of R20 000 per year. You decide to take R15 000 of the R20 000 to pay off your original loan starting from year 1. After year 6 the business grows by R1 000 a year for the next 8 years. You decide to take the extra profits and use it to pay off the original loan as well so that by year 14 you are paying R23 000 to pay off the original loan. After the 8 years of growth, competitors enter the market and you see your profits decrease by 5% a year so you decide to decrease your payments after year 14 by 5% year on year. At year 25 you want to sell the business as you think the market is getting saturated. How much must you sell the business to be able to pay off the original loan? i) Draw a cash flow diagram of the situation described above. [3] ii) What is the NPV of the payments made from year 0 to year 6. [2] iii) What is the NPV of the payments made from year 7 to year 14. [4] iv) What is the NPV of the payments made from year 15 to year 24. [3] v) what is this the future value at year 25 that the business must be sold for? [2] Inflation and interest rate K =8.00%