This preview shows page 1. Sign up to view the full content.
Unformatted text preview: investment is to pay each "unit" $40,000. A similar payment is to occur at the end of year four, five, and six. At the end of the seventh year, Chef Bartell has then promised to buy back the "unit" for $400,000. Assuming you desire to earn at least a 12% rate of return, should you make the investment (i.e., does the proposal have a positive net present value)? How should uncertainty factor into the evaluation?...
View Full Document
- Spring '11