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e. CAGR (compound ordinary progress return). A capital investor is actually considering The online return gained yr soon after yr, As a result usage of geometric is a lot more suitable. That's why we might use geometric average for chance cost-free level and possibility quality for each in the a few divisions, as specified in exhibit 5 of your case.

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Having said that, this is predicted to vary as being the hotel appreciates in worth, Considering that the management cost represents The existing worth of the property. Consequently, the yearly rate will even be increased than the management cost.

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