b) EXplain property nterests that caneos QUESTION TREE A property could be sold today for Sh.2 million. It has a loan balance of Sh.I million and. if sold, the investor would incur a capital gains tax of Sh.250,000. The investor has determined that ifit were sold today, she would earn an IRR of 15% on equity for the past five years. Ir not sold, the property is expected year. At the end of the year, the property value is expected to increase to Sh.2.1 million, the loan balance will decrease to Sh.900,000, and the amount of capital gains tax due is ex to increase to Sh.255,000. to produce after tax cash flow of Sh.50,000 over the next Required: a) What is the marginal rate of return for keeping the property one additional year? b) What advice would you give to the investor? 125 marks) Page 1 of 2