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Need full explanation not just an answer. I know the answer is 3.5% Consider the table for an income property that is under evaluation for
Need full explanation not just an answer. I know the answer is 3.5%
Consider the table for an income property that is under evaluation for purchase with a $455,000 loan. What would be the equity dividend rate? NOI DS Cash flow Resale in year 3 Less mortgage balance Total cash flow Present value of cash flow @ 15% Year 1 Year 2 Year 3 $72,000 $74,880 $ 77,875 60,000 60,000 60,000 $12,000 $14,880 $ 17,875 900,000 -435,000 $12,000 $14,880 $ 482,875 $10,43 $11,25 $ 317,498 Multiple Choice 3.5 percent $317,498 0 24 percent $12,000Step by Step Solution
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