Luca is expanding her dress shop to include a new line of shoes. The expansion will cost $275,000 initially, with a further investment of $200,000 in three years. She expects to earn $80,000 additionally per year from the expansion over the next ten years. If interest is 7.5% compounded annually, by what amount will the current economic value of Larissa's dress shop be increased or decreased is she proceeds with the expansion?

Question

Quizplus · Accepted Answer

The Answer of Luca is expanding her dress shop to include a new line of shoes. The expansion will cost $275,000 initially, with a further investment of $200,000 in three years. She expects to earn $80,000 additionally per year from the expansion over the next ten years. If interest is 7.5% compounded annually, by what amount will the current economic value of Larissa's dress shop be increased or decreased is she proceeds with the expansion?

Luca Is Expanding Her Dress Shop to Include a New