Suppose you inherited a restaurant the annual rent for it, Ask an Expert

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Suppose you inherited a restaurant. The annual rent for it is $100,000 for the next year and will go up by 5% every year.

A company offers to rent it at a fixed annual rent for 5 years. After year 5, you could re-negotiate or rent it to someone else.

What is the minimum acceptable fixed rental payments for this five-year agreement? Use a discount rate of 12%.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92850403

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