A store will cost $$950,000$ to open. Variable costs will be $49\%$ of sales and fixed costs are $$240,000$ per year. The investment costs will be depreciated

straight$-$line over the $7$ year life of the store to a salvage value of zero. The opportunity cost of capital is $8\%$ and the tax rate is $25\%.$

Find the operating cash flow if sales revenue is $$950,000$ per year.

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Correct response: $217,303\mathrm{.}57+-1$

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Using an operating cash flow of $217,303\mathrm{.}57,$ calculate the Net Present Value. Should the store be opened?

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open store $,$ NOT open store

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Section Attempt $1$ of $1$