1. In order to estimate a terminal (reversion) value for an income producing commercial property using the perpetuity growth method using a 7 year horizon (i.e., estimating terminal value in the 7th year), the following statement would be true: a. Divide the 7th year NOI by the growth rate less the discount rate b. Divide the 7th year NOI by the discount rate less the growth rate c. Divide the estimated 8th year NOI by the growth rate less the discount rate d. Divide the estimated 8th year NOI by the discount rate less the growth rate 2. When using the perpetuity growth method noted above to estimate a property's value in a future year, the resulting value would if just the discount rate were increased and it would if just growth rate were decreased. a. Increase, decrease b. Increase, increase c. Decrease, decrease d. Decrease, increase 3. Assume you were evaluating a commercial property for purchase and felt that the seller may be overstating both the current net rents (after vacancies) as well as the level at which rents would increase in coming years. You would be most likely to: a. Use a lower cap rate to reflect your more conservative view relative to seller b. Use a higher cap rate to reflect your more conservative view relative to seller c. Use a lower occupancy rate to reflect your concerns d. Both C and A e. Both C and B