QUESTION 5 of 10:Your uncle is offering to sell you his T-shirt printing business for 1M You think a multiple of 10X earnings (profit)is fair. His earnings are 69,000 per year. Should you buy it? a) Yes b) No

To determine whether you should buy the T-shirt printing business, we need to calculate the value based on the multiple of 10X earnings.<br /><br />Given:<br />- Earnings = $69,000 per year<br />- Multiple = 10X<br /><br />Step 1: Calculate the fair value of the business.<br />Fair value = Earnings * Multiple<br />Fair value = $69,000 * 10<br />Fair value = $690,000<br /><br />Step 2: Compare the fair value with the offered price.<br />Offered price = $1,000,000<br />Fair value = $690,000<br /><br />Since the offered price ($1,000,000) is higher than the fair value ($690,000), it would be a good investment.<br /><br />Answer: a) Yes