You have just completed a feasibility study for a new coffee shop in some retail space you own. You bought the space two years ago for , and if you sold it today, you would net after taxes. Outfitting the space for a coffee shop would require a capital expenditure of plus an initial investment of in inventory. What is the correct initial cash flow for your analysis of the coffee shop opportunity?

Secured loans are protected by collateral security. examples: title loans where the borrower uses the car title as collateral security interest rates are lower and repayments are longer therefore risk is low as a collateral security is given as guarantee to the bank in case of failure to pay the loanunsecured loans are not protected by collateral security but it is given on the creditworthiness of the borrower, trusting that she/he will pay on time. examples; payday loans is a short term loan where the borrower lends money from the bank and pays is back when the borrower receives his/her wages.interest rates are high and repayments are shorter. but the risk is high as no collateral security is given as a guarantee to the bank for payment of the loan