An investor has owned a property for five years. A property could be sold today for $2 million. It has a loan balance of $ 1 million and, if sold, the investor would incur a total of $250,000 in taxes (capital gains tax + depreciation recapture tax). The investor has determined that if it were sold today, she would have earned an IRR of 15% on equity for the past five years. If not sold, the property is expected to produce after tax cash flow of $50,000 over the next two years. At the end of the two years, the property value is expected to increase to $2.1 million, the loan balance will decrease to $900,000. If sold after two years, the investor would incur a total of $255,000 in taxes. (Continuation of Question 1) The owner determines that if the property were renovated instead of sold, after tax cash flow over the next two years would increase to $60,000 and the property could be sold after two years for $2.4 million. Renovation would cost $250,000. The investor would not borrow any additional funds to renovate the property. Assume that taxes due on sale after two years would be $255,000. C. What is the rate of return the investor would earn on the additional funds invested in renovating the property (compared to not renovating the property and continuing to operate it as is)? D. The investor has an outside investment opportunity that is expected to earn him a rate of return of 15%. Would you recommend the property be renovated