Temple Island Development Company has purchased land for 50 million and proposes to develop 60 housing units.
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Temple Island Development Company has purchased land for 50 million and proposes to develop 60 housing units. The houses will take 2 years to be ready, and the developer accepts a discount rate of 16%. The cost of developing the house is 10 million and the sale of each house is 25million. Design fee @ 15% of Construction fee. Assume interest of 15% for unseen factors after 6 months of commencement. A cost of Disposal of units at 10% of GDV Advise the Company on financial viability of the project. How much should it pay for land if it had not been paid for?
Related Book For
Fundamentals of Corporate Finance
ISBN: 978-1259024962
6th Canadian edition
Authors: Richard Brealey, Stewart Myers, Alan Marcus, Devashis Mitra, Elizabeth Maynes, William Lim
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