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Let's return to the 10% appreciation case. Normally, when you buy a house, you don't pay for the entire house in cash-you make a down payment, say 20%. We will assume that you rent the house and the rent payments cover mortgage payments and any other expenses.) As an investor, you are interested in your "rate of return"-that is, how much your investment is worth at the end of year n compared to how much it was worth at the end of the year n1 Calculate your rate of return (a) 50% down payment (b) 20% down payment (c) 10% down payment (d) 35% down payment 4. for each of the first six years assuming 5. Write a difference equation that describes your rate of return in each of the three cases. What happens to your rate of return and why? (10 points) 6. Suppose you want a constant rate of return of 20%. What will have to happen to the value of the house? [Team response fully explained]. (5 points) Let's return to the 10% appreciation case. Normally, when you buy a house, you don't pay for the entire house in cash-you make a down payment, say 20%. We will assume that you rent the house and the rent payments cover mortgage payments and any other expenses.) As an investor, you are interested in your "rate of return"-that is, how much your investment is worth at the end of year n compared to how much it was worth at the end of the year n1 Calculate your rate of return (a) 50% down payment (b) 20% down payment (c) 10% down payment (d) 35% down payment 4. for each of the first six years assuming 5. Write a difference equation that describes your rate of return in each of the three cases. What happens to your rate of return and why? (10 points) 6. Suppose you want a constant rate of return of 20%. What will have to happen to the value of the house? [Team response fully explained]. (5 points)