1. Given the following information regarding an income producing property, determine the internal rate of return (IRR) using levered cash flows. Expected Holding Period: 5 years; 1st year Expected PGI: $91,000; 2nd year Expected PGI: $91,000; 3rd year Expected PGI: $91,000; 4th year Expected PGI: $91,000; 5th year Expected PGI: $91,000; Vacancy 3% annually; Other Income $10,000 annually; Operating Expenses 40% of EGI annually. Debt Service in each of the next five years: $30,000; Purchase Price: $875,000; Required equity investment: $225,000; Gross Sales Price at end of year 5: $975,000 with Closing Expenses of $12,000 and Disposition Fee (Brokerage Commission) of 3% of Gross Sales Price.; Remaining Mortgage Balance at end of year 5: $630,000.

   		22.80%
   		23.98%
   		-13.92%
   		17.79%