Estimate the revenue at collegeville

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PizzaPizza is considering two college towns, Collegeville and University City, to open their new store this August, just in time for the fall semester. The Collegeville location requires an initial investment of $126,000, whereas the University City location requires $185,000. From the student population and the competition, the ?nance team estimates the revenue at Collegeville to be $48,000 a year and the revenue at University City to be $56,000. Assuming a hurdle rate of 15%, how long it will take to get the investment back for each location? Include the time value of money in your analysis.

Reference no: EM133125189

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