ZN il -A-D-A- 1 Normal 1 No Spac... Heading 1 Heading 2 Title Paragraph Styles 1 4 Q5: Toma is thinking about quitting his current job, which pays a salary of $62,000 per year, to own and operate his own business. Investors are able to earn 12% from businesses that are equally risky as Toma's intended business. If he started the business, he would spend $260,000 to purchase physical capital. This amount of money would come from two sources: $150,000 would be borrowed from a bank at an interest rate of 5% per year and $110,000 would come from Toma's savings that are currently earning 0.8% in a risk-free savings account. The physical capital is expected to have useful life of 10 years and a scrap value of $26,000. Toma expects to spend $120,000 per year on assistants and will pay himself a salary of $25,000 per year while operating his business. His business is expected to earn total revenues of $250,000. After learning that Toma might quit, his employer offers him a salary of $68,000 per year to convince him to stay at his current job. ZN il -A-D-A- 1 Normal 1 No Spac... Heading 1 Heading 2 Title Paragraph Styles 1 4 Q5: Toma is thinking about quitting his current job, which pays a salary of $62,000 per year, to own and operate his own business. Investors are able to earn 12% from businesses that are equally risky as Toma's intended business. If he started the business, he would spend $260,000 to purchase physical capital. This amount of money would come from two sources: $150,000 would be borrowed from a bank at an interest rate of 5% per year and $110,000 would come from Toma's savings that are currently earning 0.8% in a risk-free savings account. The physical capital is expected to have useful life of 10 years and a scrap value of $26,000. Toma expects to spend $120,000 per year on assistants and will pay himself a salary of $25,000 per year while operating his business. His business is expected to earn total revenues of $250,000. After learning that Toma might quit, his employer offers him a salary of $68,000 per year to convince him to stay at his current job