6. [10 pts.] Our firm owns a lot suitable for building either five or ten condominium units. The firm is considering selling the lot to a real estate developer. Assume that The risk free rate is 8% Per unit construction costs are currently: * $100,000 per unit if you build five units $115,000 per unit if you build ten units Construction does not take time The current market price of each unit is $130,000 .Per year rental rate is $10,000 per unit (net of expenses, to be paid at the end of the year) .Next year, if market conditions are: Favorable, condos sell for $160,000 Unfavorable, condos sell for $115,000 a. What is the value of the land? b. Now assume that if the developer builds five units this year, they have the ability to build an additional floor onto the building next year to create an additional five units. Each of the additional units would cost $110,000 to build and the developer would have to purchase one permit from the city for $20,000 in order to build all five additional units. All of the costs would occur at time 1 when the units are built. What is the value of the land