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Could you help those question. Thank you so much! Use this information to answer the following 3 questions An investor is considering buying a residential

Could you help those question. Thank you so much! image text in transcribed
Use this information to answer the following 3 questions An investor is considering buying a residential income property for $500,000, and holding it for three years. The expected equity cash flows after tax (ATCF) from operation are: Year 1 - $16,000 Year 2- $14,000 Year 3 # $ 12,000 A 75% of value mortgage is available, the remaining balance, after 3 years, will be S365.501. depreciation to be taken over the holding period will equal $43,636 on improvements with a be basis of $400,000. The investor is in the 28% Total of ordinary capital gain tax bracket while the depreciation e is assumed to be 28% in this period. The investor desires a 12% after-tax return on the recapture rat equity investment. The property is expected to sell for $575,000 before the depreciation recapture tax is in effect; there will be a 6% sales commission. Based on tax laws assumed here, answer the following 3 questions 55. What is the total capital gain tax liability upon sale? a. $23,558 c. $20,750 e. $51,558 b. S16,754 d. S33,218 56. If an investor has a required rate of return of 12%, what is the projects net present value? a. $18,779 c. $33.252 b. $16.781 d. $25,736 57. What is it's IRR? a. 19.93% b. 15.28% d. 17.33% 2.75%

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