Please Answer the following questions (Q2 & Q3) with calculations and explanations. Thank you!

Real Estate Finance Please show step-by-step calculations with explanations Equity capitalization 2) Consider the table for an income property that is under evaluation for purchase with a $455,000 loan. Using the principles of mortgage equity capitalization, What is the estimated total property value (rounded to the nearest $100)? Year 1 Year 2 Year 3 N01 $ 72,000 $ 74,880 $ 77,875 DS 60,000 60,000 60,000 Cash ow $ 12,000 $ 14,880 $ 17,875 Resale in year 3 900,000 Less mortgage balance -435,000 Total cash ow $ 12,000 $ 14,880 $ 482,875 Present value of cash ow @ 15% $ 10,435 $ 11,251 $ 317,498 A) $317,500 B) $482,900 C) $772,500 D) $794,200 Answer: D Real Estate Finance Please show step-by-step calculations with explanations Equity capitalization B) 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? Year 1 Year 2 Year 3 N01 $ 72,000 $ 74,880 $ 77,875 DS 60,000 60,000 60,000 Cash ow 8 12,000 $ 14,880 $ 17,875 Resale in year 3 900,000 Less mortgage balance -435,000 Total cash ow $ 12,000 $ 14,880 $ 482,875 Present value of cash ow @ 15% $ 10,435 $ 11,251 $ 317,498 A) 2.4 percent B) 3.5 percent C) $12,000 D) $317,498 Answer: B