the donut shop inc is planning to add a 2nd donut


The Donut Shop, Inc. is planning to add a 2nd Donut Shop by opening a new store across from Webster University. A survey of the area has already been completed at a cost of $150,000. Annual revenues are expected to be $5 million. However, opening the new shop will cause annual revenues at the other Donut Shop located a mile from Webster's campus to drop by $2 million per year. What is the relevant annual revenue that should be used in the capital budgeting analysis of opening the new Donut Shop?

 

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Financial Management: the donut shop inc is planning to add a 2nd donut
Reference No:- TGS0208041

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