What will her annual profits for the store need

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1. Rhonda has found a location for the next store she plans to open. The store front will require $30,000 in renovations before it is ready to open. She would like the initial investment to be paid off in 5 years. Assuming a discount rate of 4.5%, what will her annual profits for the store need to be if she wishes to recover the $30,000 in 5 years (assuming equal profits each year)?

2. What if the discount rate increased to 7.75%? What would her annual profits need to be to recover the $30,000 in 5 years?

Reference no: EM132681580

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