To which businesses should lease and why

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Reference no: EM13257913

Your firm is preparing to open a new retail strip mall and youhave multiple businesses that would like lease space in it. Each business will pay a fixed amount of rent each month plus apercentage of the gross sales generated each month. The cashflows from each of the businesses have approximately the sameamount of risk. The business names, square footagerequirements, and monthly expected cash flows for each of the businesses that would like to lease space in your strip mall areprovided below. If your new strip mall will have 15,000 square feetof retail space available to be leased, to which businesses shouldyou lease and why?

Business Name

Square Feet Required

Expected Monthly Cash Flow

Videos Now

4,000

70,000

Gords Gym

3,500

52,500

Pizza Warehouse

2,500

52,500

Super Clips

1,500

25,500

30 1/2 Flavors

1,500

28,500

S-Mart

12,000

180,000

WalVerde Drugs

6,000

147,000

Multigular Wireless

1,000

22,250

Reference no: EM13257913

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