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Bailey, Kaylee, Haley, and Joyce are sorority sisters who have discovered an opportunity to purchase an Internet café. Each of the women would have to put up $80,000 to make the purchase. The revenue from the café is expected to remain constant at $225,000 per year for the next several years. The costs (not including the opportunity costs of the investment) of operating the café are expected to remain constant at $185,000 for the next several years. The current market interest rate on enterprises with comparable risks is 9% per year. Should the four sorority sisters purchase the café? Explain

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M91702369

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