1) A property is sold for $1,000,000. Typical financing terms are an 85% loan with a 7% interest rate over 15 years. If the before-tax cash flow is $10,000 monthly, what is the overall capitalization rate?

2) A lender requires a 1.25 debt coverage ratio as a minimum. If the net operating income of a property is $470,000, what is the maximum amount of debt service the lender would allow?

3) A building owner charges net rent of $22 in the first year, $23 in the second year, and $24 in the third year. Using a 9 percent discount rate, what is the effective rent over the three years?

4) A building owner charges net rent of $22 in the first year, $23 in the second year, and $24 in the third year, but is providing six months of free rent in the first year as a concession. Using a 9 percent discount rate, what is the effective rent over the three years?

5) A 1,000 square foot office space is leased at $15.00 square foot. The space is vacant one month out of the year. Office expenses are $8.50 per square foot and an expense stop is set at $8.00 per square foot. What is the annual net operating income?