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Mitchell Operates a Diner in Pleasantville

question 142

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Mitchell operates a diner in Pleasantville. Currently, the diner is not certified by the Pleasantville Restaurant Club. To get the diner certified, Mitchell would need to spend $20,000. Once certified, Mitchell expects to receive $5,000 in additional profits every year for perpetuity beginning 1 year from certification. What must Mitchell's discount rate be if he gets certified by the restaurant club?


Definitions:

Heat Exhaustion

The result of excessive heat and dehydration; signs include pallor, dizziness, nausea, vomiting, fainting, and a moderately increased temperature (38.5°C to 39°C).

Malignant Hyperthermia

A pharmacogenetics disease that can be triggered by exposure to certain anesthetic agents; signs include elevated carbon dioxide production, profuse sweating, tachycardia, and skeletal muscle rigidity, prior to developing a life-threatening rapid increase in core body temperature.

Hyperpyrexia

An extremely high body temperature or fever, typically above 41.1 degrees Celsius (106 degrees Fahrenheit), which can be life-threatening.

Peripheral Vascular Resistance

The resistance that blood vessels outside the heart offer against the flow of blood, playing a crucial role in determining blood pressure.

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