Question 14 (1 point) Saved Rob bought a store two years ago for $250,000. He leased...

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Question 14 (1 point) ✔Saved Rob bought a store two years ago for $250,000. He leased it out at $4,000 a month. Now he is considering the option to cancel the lease and use the location as a pet-grooming store. About two months ago, Rob changed the flooring of the store at a cost of $20,000. He estimates that the machinery for the pet-grooming store will cost $150,000. Rob expects the net operating cash flows to be $35,000 annually for 5 years, after which he plans to scrap the remaining inventory and retire. If he opens up this new store, the sales from his other pet-grooming store would drop by 10% Rob wants a return of 9% on his investment or else he would not go ahead with his plans. The $250,000 Rob used to buy the store would be included in the calculation of NPV. True False Question 14 (1 point) ✔Saved Rob bought a store two years ago for $250,000. He leased it out at $4,000 a month. Now he is considering the option to cancel the lease and use the location as a pet-grooming store. About two months ago, Rob changed the flooring of the store at a cost of $20,000. He estimates that the machinery for the pet-grooming store will cost $150,000. Rob expects the net operating cash flows to be $35,000 annually for 5 years, after which he plans to scrap the remaining inventory and retire. If he opens up this new store, the sales from his other pet-grooming store would drop by 10% Rob wants a return of 9% on his investment or else he would not go ahead with his plans. The $250,000 Rob used to buy the store would be included in the calculation of NPV. True False

Answer rating: 100% (QA)

The detailed answer for the above question is provided below False The 250000 Rob used to buy ... View the full answer