Beginning value of asset 1,00,000 Total return on asset 2.0% Amount borrowed 67,000 Interest rate on borrowed
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Question:
| Beginning value of asset | 1,00,000 | |||
| Total return on asset | 2.0% | |||
| Amount borrowed | 67,000 | |||
| Interest rate on borrowed money | 7.0% | |||
| At the beginning, you buy the asset with your own and | ||||
| borrowed money. | ||||
| Time goes by. It is now the end of the story. | ||||
| Your asset has changed in value, as shown above. | ||||
| You sell it. | ||||
| You pay back what you borrowed, plus interest. | ||||
| What has been the total rate of return on your own money? | ||||
| A Between -30.0% and -12.0% | ||||
| B Between -12.0% and 0.0% | ||||
| C Between 0.0% and 12.0% | ||||
| D Between 12.0% and 30.0% |
Expert Answer:
Related Book For 
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
