You are looking at a property that is priced at $800,000 and promises the following cash...

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You are looking at a property that is priced at $800,000 and promises the following cash flows for the 5 years you will hold it. At the end of 5 years you anticipate to sell the property for $880,000 which will be additional cash flow at the end of the 5th year. If the bank charges you 15% interest to borrow the funds (so you can purchase the property), is this a good investment? (Show your work!! - if you are using the Cash-Flow function of your calculator, indicate the calculator steps as your shown work) You are looking at a property that is priced at $800,000 and promises the following cash flows for the 5 years you will hold it. At the end of 5 years you anticipate to sell the property for $880,000 which will be additional cash flow at the end of the 5th year. If the bank charges you 15% interest to borrow the funds (so you can purchase the property), is this a good investment? (Show your work!! - if you are using the Cash-Flow function of your calculator, indicate the calculator steps as your shown work)

Answer rating: 100% (QA)

To determine if this is a good investment we need to calculate the present value of the anticipated ... View the full answer