81. You are considering the purchase of abusiness that is currently earning $25,

Question

81.   You are considering the purchase of abusiness that is currently earning $25,000 per year in after-taxprofit. If these conditions are expected to continue year afteryear into the future, and the interest rate is currently 10percent, the current market value of this business is A.   $2,500. B.   $25,000. C.   $250,000. D.   $2,500,000 81.   You are considering the purchase of abusiness that is currently earning $25,000 per year in after-taxprofit. If these conditions are expected to continue year afteryear into the future, and the interest rate is currently 10percent, the current market value of this business is

Explanation / Answer

C. $ 250,000 Explanation 25,000 10%

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