Gloria wants to be a real estate investor. She has found a property she thinks might be
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Question:
Year 1: $22,350 Year 2: $21,785 Year 3: $23,650 Year 4: $23,830 Year 5 $77,650
If Gloria decides that she will only buy this property if she can earn an annual return of 11 percent, how much equity should she be willing to invest in the property today?
2. If the property in the previous question requires Gloria to put $115,000 of equity into the deal, should she invest in this property? Why or why not?
3. If the property in the previous question requires Gloria to put $115,000 of equity into the deal, what is the NPV of this deal?
Related Book For
Quantitative Methods for Business
ISBN: 978-0324651751
11th Edition
Authors: David Anderson, Dennis Sweeney, Thomas Williams, Jeffrey cam
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