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e. CAGR (compound common progress return). A cash Trader is really enthusiastic about The online return attained 12 months soon after yr, thus use of geometric is a lot more suitable. Hence we would use geometric typical for possibility cost-free charge and danger high quality for each in the a few divisions, as presented in exhibit five in the case.

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Most hotel operators will only target the existing price of the Homes, or maybe the NPV. They do not usually consider the long-phrase routine maintenance service fees, which has a large impact on the prolonged-phrase upkeep expense of the hotel.

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