QUESTION 12 The owner of commercial property that has a Fish-Fil-A on the property is expected to produce net operating cash flows annually, as follows, at the end of each of the next five years: Year 1 = Year 2 = Year 3 = Year 4 = Year 5 = $ 48,000 $ 56,000 $ 66,000 $69,000 $ 75,000 He would like to sell the property and you are interested in just commercial land (no ongoing maintenance). You have assumed a future sales price at the end of the fifth year $650,000. The required rate of return on projects of similar risk is 14%. However, you don't want to assume you could get that price to make a significant investment decision, so you wondered what your future sales range would be and wanted t know if this would still be a good investment if you sold the property for $600,000. Would you sell at that price and still be a good investment? A. No B. Yes

The owner of commercial property that has a Fish.Fil-A on the property is expected to produce net operating cash fows annually, as follows, at the end of each of the next five years Year 1=$48,000 Year 2=$56,000 Year 3=$66,000 Yoar 4=$69,000 Year 5=$75,000 He would like to sell the property and you are interested in just commercial land (no ongoing maintenanco). You have assumed a future sales price at the end of the fith year 5650,000 . The required rate of return on projects of similar nisk is 14%. However, you dont want to astume you could get that price to make a significant invostment decision, so you wondered what your future sales ranpe would be and wanted know if this would stit bo a good investment if you sold the property for 5600,000 . Would you sell at that price and still be a good invostment? A. No B. Yes