a. Real Estate investments are often purchased with the use of borrowed funds. Explain why this is so. (11 marks)

b. Using a simple illustrative diagram or/and worked, explain how using layered debt (e.g. senior, mezzanine etc) funds can lead to both higher returns but also higher losses. (11 marks)

c. Differentiate between the concepts of yield and return. In answering this and with the use of your own examples, demonstrate the difference between, initial yield, reversionary yield, income return, capital return and the internal rate of return. (11 marks)