A real estate investor is considering the purchase of a small office building. The following assumptions are

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A real estate investor is considering the purchase of a small office building. The following assumptions are made:

Answer the following questions for the first year of operations:

a. What is the equity (cash) down payment required at “time zero”?

b. What is the annual tax depreciation deduction?

c. What is the total debt service in year 1?

d. What is the estimated net operating income?

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