An investor would like to purchase a new apartment property for $$2$ million. However, she faces the decision of whether to use $70$ percent or $80$ percent financing. The $70$ percent loan can be obtained at $10$ percent interest for $25$ years. The $80$ percent loan can be obtained at $11$ percent interest for $25$ years.

NOI is expected to be $$190,000$ per year and increase at $3$ percent annually, the same rate at which the property is expected to increase in value. The building and improvements represent $80$ percent of value and will be depreciated over $27\mathrm{.}5$ years $(\frac{1}{27\mathrm{.}5}$ per year$).$ The project is expected to be sold after five years. Assume a $36$ percent tax bracket for all income and capital gains taxes.

a$.)$ What would be BTIRR and ATIRR be at each level of financing $($assume monthly mortgage amortization$)?$

b$.)$ Does each loan offer favorable financial leverage? Which would be recommended?