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Question 3 (6%) A landlord wants advice on how she might decide whether or not to add an additional bathroom. The cost of the addition

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Question 3 (6%) A landlord wants advice on how she might decide whether or not to add an additional bathroom. The cost of the addition is $10,000. The interest rate is 5%. She can expect get an additional $450 per annum rent as a result for the life of the bathroom. a) Should she do the investment? (200) b) If the additional rents were $440, should she do the investment? (296) c) What would be the position ifthe interest rate were 4067 (206)

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