Question: Your client asks you to indicate a cap rate for the subject property using the band-of-investments technique, using the following parameters: 70% loan-to-value ratio 6%

Your client asks you to indicate a cap rate for the subject property using the band-of-investments technique, using the following parameters: 70% loan-to-value ratio 6% interest rate (monthly compounding) 30-year amortization 8% equity dividend rate (2.5 bonus points possible) What is your cap rate indicated by this technique? Present your percentage to the one-hundredth decimal place (e.g., 10.25%).

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