An apartment building is expected to generate the following income:

The initial investment (acquisition price) is $180,000 and the investor will finance the purchase with a fixed-rate mortgage loan of 150,000 at 7.5% interest rate for 25 years.

Q5. What is the Equity Dividend Rate? Show your work. (1 point)

Year1 Year2 NOI 15,000 13,000 Depreciation 3,500 3,500 BTCFO 3,000 4,000 BTCF from sale Year3 14,000 3,500 5,000 Year4 15,000 3,500 6,000 140,000 Year1 Year2 NOI 15,000 13,000 Depreciation 3,500 3,500 BTCFO 3,000 4,000 BTCF from sale Year3 14,000 3,500 5,000 Year4 15,000 3,500 6,000 140,000