18. A property with an 10% unlevered IRR has a 70% LTV mortgage with an interest rate of 7% has Levered/Equity IRR of 17.0%. A new lender will charge 8.0% for an 80% LTV loan. Assuming the borrower will increase the loan amount only if it is favorable, should she?

A. Yes because overall leverage is still positive

B. No because the incremental cost is not favorable

C. No because the incremental cost is higher than the Base Case Levered/Equity IRR

D. Yes because the incremental cost is favorable

19. What is the Debt Coverage Ratio (DCR) for a property with an NOI return of 6% and an 80% LTV interest-only mortgage with a rate of 4%?

A. 1.500

B. 1.875

C. none of the choices are correct

D. 1.250