Reggie has just taken over the management of a family business. He wants to make sure that he makes financial sense to keep the business going. He could sell the building today for $530,000. Keeping the business going will require an $80,000 renovation now and generate an annual profit of $101,000 for the next 25 years (for simplicity, assume this is at the end of the year, starting a year from now). The discount/interest rate is 6%. 

What are the GO and IRR of this decision?

Answer rating: 100% (QA)

To determine whether it makes financial sense to keep the business going we need to calculate the ne... View the full answer