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Question 4 1 pts Zack has a two-bedroom house with a huge garage. He is paying $1,500 for his monthly mortgage payment. Since he doesn't
Question 4 1 pts Zack has a two-bedroom house with a huge garage. He is paying $1,500 for his monthly mortgage payment. Since he doesn't have a car, he is considering remodeling the garage, turning it into a master suite, and renting it on Airbnb. The remodeling cost is estimated to be $10,000 and he believes he could make $500 a month for the next five years by renting the suite on Airbnb. Assuming a 6% interest rate, what is the NPV of remodeling the garage? Hint: Pay attention that APR is 6% while the rent cash flows are monthly! Round your answer to the nearest dollar and enter without $ sign. For example, enter 743 for $742.76. 15,863 Question 3 1 pts Sydney just won $500,000 in the Oregon lottery! She is considering buying a house, rent it for 25 years, and then sell the house. Her real estate agent believes that she can rent the house for $3,000 per month and that the house will sell for 150% of its current price in 25 years. Assuming inflation rate is zero and annual rate of return is 6%. what is the NPV of this investment? Hint: Pay attention that APR is 6% while the rent cash flows are monthly! Round your answer to the nearest dollar and enter without $ sign. For example, enter 743 for $742.76. 133,595
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