A) Conduct a one-way Sensitivity Analysis for After-Tax NPV with specified alternative returns to equity of 9%, 7%, and 5%. B) Conduct a two-way sensitivity analysis for after-tax IRR and MIRR with specified terminal cap rates of 11%, 10.5%, and 10%, and Growth Rates of PGI from 0% to 6%. Compare your calculations to those illustrated below.
PLEASE SPECIFY WHAT TO INSET IN "ROW INPUT CELL" AND "COLUMN INPUT CELL" FOR EACH TABLE, USING WHAT IF ANALYSIS DATA TABLE
PLEASE ANSWER BOTH AND NOT ONLY ONE, BOTH A AND B SHOULD ANSWERED
Data Table Model Outputs Property-Specific IRR Property-Specific MIRR 10.7% Sensitivity Analysis: After-Tax NPV Alternative Return to Equity 9.0% 7.0% 5.0% 41,5161 10.3% Row input cell: Property Assumptions Acquisition (+Improvements) Potential Gross Income Expected Vacancy Operating Expenses (% of EGI) Capital Expenditures Annual Growth Rate of PGI Brokerage Expenses When Sell Terminal Cap Rate in 4 years Column input cell: 900,000 180,000 10.0% 40.0% 8,100 3.0% 5.0% 10.5% Before-Tax NPV Before-Tax IRR Before-Tax MIRR 64,3891 21.8% 18.5% Cancel OK 6.0% After-Tax NPV After-Tax IRR After-Tax MIRR 41,516 17.1% 14.8% Sensitivity Analysis: After-Tax IRR Base Terminal Cap Rate 17.1% 9.0% 7.5% 0% 1% 2% 3% 4% 5% 6% Interest-Only Loan Assumptions Principal Interest Rate Origination Fees (points) Growth Rate of PGI 796,500 8.0% 3.0% Investor Assumptions Alternative Return to Equity Finance Rate of Negative Cash Flows 7.0% 5.0% 6.0% Sensitivity Analysis: After-Tax MIRR Base Terminal Cap Rate 14.8% 9.0% 7.5% 0% 1% 2% 3% 4% 5% 6% Taxation Assumptions Depreciable Basis (t=0) Depreciable Life (years) Marginal Income Tax Rate (%) Price Appreciation Tax Rate (%) Depreciation Recapture Tax Rate (%) 685,000 39.0 37.0% 15.0% 25.0% Growth Rate of PGI Data Table Model Outputs Property-Specific IRR Property-Specific MIRR 10.7% Sensitivity Analysis: After-Tax NPV Alternative Return to Equity 9.0% 7.0% 5.0% 41,5161 10.3% Row input cell: Property Assumptions Acquisition (+Improvements) Potential Gross Income Expected Vacancy Operating Expenses (% of EGI) Capital Expenditures Annual Growth Rate of PGI Brokerage Expenses When Sell Terminal Cap Rate in 4 years Column input cell: 900,000 180,000 10.0% 40.0% 8,100 3.0% 5.0% 10.5% Before-Tax NPV Before-Tax IRR Before-Tax MIRR 64,3891 21.8% 18.5% Cancel OK 6.0% After-Tax NPV After-Tax IRR After-Tax MIRR 41,516 17.1% 14.8% Sensitivity Analysis: After-Tax IRR Base Terminal Cap Rate 17.1% 9.0% 7.5% 0% 1% 2% 3% 4% 5% 6% Interest-Only Loan Assumptions Principal Interest Rate Origination Fees (points) Growth Rate of PGI 796,500 8.0% 3.0% Investor Assumptions Alternative Return to Equity Finance Rate of Negative Cash Flows 7.0% 5.0% 6.0% Sensitivity Analysis: After-Tax MIRR Base Terminal Cap Rate 14.8% 9.0% 7.5% 0% 1% 2% 3% 4% 5% 6% Taxation Assumptions Depreciable Basis (t=0) Depreciable Life (years) Marginal Income Tax Rate (%) Price Appreciation Tax Rate (%) Depreciation Recapture Tax Rate (%) 685,000 39.0 37.0% 15.0% 25.0% Growth Rate of PGI
