1.How much would youpay for the right to receive $30,000 at the end of 8years if you can earna12%return ona real estate investment withsimilar risk?

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2. Whatconstant amount invested at the end of each year at8.5% annual interest rate willbeworth$12,000 at the end ofsixyears?

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3. Your father will convey a propertyto you in 15years. If the property is expected to be worth $350,000when youreceiveit, what is the present value of the property? Your discount rate is 11.5%.

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4. What is the NPV of $1,000receivedat the end ofthenext four years and $1,800 received at the end ofthefifth year if your required return is 10%?

Year 1 2 3 4 5

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5.Assumingno income or holding costs during the period, if youpurchased a vacantparcel oflandeightyears ago for $1,150,000, how muchwould you have tosell it

fortoday in orderto yield a12%annualreturn on your investment?

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