Calculating Variance of Returns Office Building {Return 3: Deviation (R - Squared P x (RExpected Scenario ATIRR Probability {Pl Probability) Expected R] Deviation Risq Pessimistic (20%) Most Likely (15%) Optimistic (10%) Expected Return Variance Standard Deviation _ Coefcient of Variation Part II Marginal Return Comparison e If sold year 4 If sold year 5 Sale price Selling Costs Mortgage balance Capital gain tax Cash ow Marginal return = {Cash flow it sold next year + Hot over next year - Cash flowlrom saleif sold today] } Cash flow if sold today Marginal return ={ l