Hassle-free web is bidding to provide web hosting services

Assignment Help Financial Management

Reference no: EM131078256

Hassle-free Web is bidding to provide web hosting services for Hotel Lisbon. Hotel Lisbon pays its current provider $10,500 per year for hosting its web page, handling transactions, etc. Hassle free figures that it will need to purchase equipment worth $15,100 up front and then can spend $2,200 per year on monitoring, updates, and bandwidth to provide the service for 3 years. If Hassle Free's cost of capital is 10.4%, can it bid less than $10,500 per year to provide the service and still increase its value by doing so?

1. Hassle-Free can bid as low as $_________

Reference no: EM131078256

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