INVESTMENT REQUIREMENTS The investor prefers to buy properties on a 5 year planning horizon. Because she has other lucrative investment opportunities, the investor insists on a 15 percent return on invested equity. Studies of the market indicate an overall capitalization rate for this kind of office project of 7.5 percent and a market discount rate for the property of 10 percent. Original market and investment values from DCF (for your comparison): Market value $ Investment value $ Retaining all of the other relevant assumptions, analyze the impact of the following variations on the project. 1. LEVERAGE -- Originally, the investor planned to borrow $700,000 at 7.75 percent amortized for 30 years with monthly payments with the remaining mortgage balance due on sale of the property. Given the current market conditions, lenders might not be as willing to loan as much on a mortgage of this type. What effect would borrowing the greater amount have on the market and investment values if the buyer borrowed $1,500,00