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Order the answer to: Veggie Burger Boy sells franchises to individuals who want to

Custom Essays business-economics Order the answer to: Veggie Burger Boy sells franchises to individuals who want to

business-economics

Order the answer to: Veggie Burger Boy sells franchises to individuals who want to

Question Veggie Burger Boy sells franchises to individuals who want to start small in the sandwiches-for-vegeterians business and grow in net cash flow over the years. A franchisee in Mississippi provided the $5000 up-front money, but did very poorly the first year. He was allowed to borrow at the end of his first year from the corporation’s capital incentive fund with a promise to repay the loan in addition to the annual share that the contractually receives from annual sales. The net cash flows from the corporation’s perspective are shown below. The corporate chief financial officer (CFO) has some questions concerning this NCF series. her by doing the following, using a spreadsheet. (a) Plot the PW versus i graph and estimate the rate of return for this franchise. (b) Use the IRR function on a spreadsheet to find the corresponding return. (c) Basing your conclusions on Descartes’ and Norstrom’s rules, provide the CFO with some advice on what ROR value is the most reliable for this franchise over the 6-year period. The normal corporate used for franchisee evaluation is 30% per year.
Subject business-economics
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