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Question 4 10 pts A rental house is listed for $160,000 and is expected to generate the following cash flows from operations: year 1: $12,000;
Question 4 10 pts A rental house is listed for $160,000 and is expected to generate the following cash flows from operations: year 1: $12,000; year 2: $12,600; year 3: $13,230; and year 4: $13,890 (roughly a 5% annual increase). Assume that at the end of year 4, the property could be sold to net $180,000. What is the approximate rate of return (IRR) to the investor who pays the asking price? 12.7% 26.4% 7.99% 10.6% 14.9%
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