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You're thinking of buying a McDonald's franchise and want a 15% return. McDonald's says that the first-year earnings will be $90,000, which should grow 3%

You're thinking of buying a McDonald's franchise and want a 15% return. McDonald's says that the first-year earnings will be $90,000, which should grow 3% every year thereafter. After crunching some numbers, you determine the NPV is $250,000. What is this investment worth to you? (assume earnings are distributed to you annually in arrears.)

b. What is the IRR of this investment?

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