Virginia Variety Stores is planning to sell its Oakton, Reston, and McLean stores. The firm expects to sell each of the

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Virginia Variety Stores Is Planning To Sell Its Oakton Reston And Mclean Stores The Firm Expects To Sell Each Of The 1 (23.94 KiB) Viewed 10 times

Virginia Variety Stores is planning to sell its Oakton, Reston, and McLean stores. The firm expects to sell each of the three stores for the same, positive cash flow of $B. The firm expects to sell its Oakton store in Q years, its Reston store in Q years, and its McLean store in P years. The cost of capital for the Oakton and Reston stores is I percent and the cost of capital for the McLean store is J percent. We know that Q> P >0 and 1>J> 0. The cash flows from the sales are the only cash flows associated with the various stores. Based on the information in the preceding paragraph, which one of the following assertions is true? O The Oakton store is the most valuable of the 3 stores O The Reston store is the most valuable of the 3 stores O Two of the three stores have equal value and those two stores are more valuable than the third store or all three stores have the same value O The McLean store is the most valuable of the 3 stores O Cannot be determined based on the information given