problem 2 You own a building that you plan on leasing to a businessman for $60,000 per year for three years. You estimat

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answerhappygod
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problem 2 You own a building that you plan on leasing to a businessman for $60,000 per year for three years. You estimat

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problem 2You own a building that you plan on leasing to a businessman for $60,000 per year for three years. You estimate the annual explicit cost and implicit cost of maintaining the building at $10,000, and $20,000 respectively. All revenues are received, and costs borne, at the end of each year. Suppose the interest rate is 5 percent.
a. Determine the present value of the stream of your accounting profits.
b.Determine the present value of the stream of your economic profits.
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