Suppose a condominium can be rented for $1,000 a month, it depreciates at 10 percent per year,
Question:
(a) For each case, compute the value of the housing price according to the simple theory developed in the chapter.
(b) Based on your results, discuss the sensitivity of condo prices to the expected capital gain.
(c) Based on your results, discuss the sensitivity of condo prices to the down-payment rate.
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