Question: Please calculate it manually step by step. Thank you. IRR 3. A client has requested advice on a potential investment opportunity involving an income producing
Please calculate it manually step by step. Thank you.
IRR 3. A client has requested advice on a potential investment opportunity involving an income producing property. She would like you to determine the internal rate of return of the investment opportunity based on the following information. Expected Holding Period: 5 years; End of first year NOI estimate: $113,900; NOI estimates in subsequent years will grow by 5% per year; Price at which the property is expected to be sold at the end of year 5: $1,615,205.22; Current market price of the property: $1,475,667.71. Use the Trial & Error Method with discount rates of 9% and 11% to determine the IRR between it. A.-15.3096 B. 8.60% C. 9.8696 D. 10.00%
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