Find that a comparable building has become available in city

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Reference no: EM13737161

Suppose you are considering moving your company’s headquarter from Nashville to LA. Last year you paid $100,000 for an option to buy a building in LA. The option gives you the right to buy the building at a cost of $1,000,000, so that if you ultimately make the purchase your total expenditure will be $1,100,000. Now you find that a comparable building has become available in the same city (LA) at a price of $1,050,000. Which building should you buy? Justify your answer.

Reference no: EM13737161

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