Question 7 (10 marks) Vikram is considering the purchase of a residential building with 8 apartments. The apartments range from 2 to 4 bedrooms in size. Each unit has two parking spots and a nice north-facing balcony with ample sun. Vikram expects the following NOIs for the property: Year Amount 2023 $400,000 2024 $420,000 2025 $440,000 2026 $460,000 2027 $480,000 Vikram plans to sell the property at the end of 2027. He expects that the building's value should appreciate by 4 percent per year during this period. Vikram plans to pay the building with cash, and he want to earn a 12 percent return on investment compounded annually. In no more than 48 words answer part A. A. How can Vikram estimate the value of the building at the end of 2027 if its present value is unknown? [Answer the question in no more than 60 words.] (3 marks) B. What is the present value of the apartment building? Show all your calculations. (5 marks) C. What is the property's reversion value at the end of 2027? Show all your calculations (2 marks) Question 7 (10 marks) Vikram is considering the purchase of a residential building with 8 apartments. The apartments range from 2 to 4 bedrooms in size. Each unit has two parking spots and a nice north-facing balcony with ample sun. Vikram expects the following NOIs for the property: Year Amount 2023 $400,000 2024 $420,000 2025 $440,000 2026 $460,000 2027 $480,000 Vikram plans to sell the property at the end of 2027. He expects that the building's value should appreciate by 4 percent per year during this period. Vikram plans to pay the building with cash, and he want to earn a 12 percent return on investment compounded annually. In no more than 48 words answer part A. A. How can Vikram estimate the value of the building at the end of 2027 if its present value is unknown? [Answer the question in no more than 60 words.] (3 marks) B. What is the present value of the apartment building? Show all your calculations. (5 marks) C. What is the property's reversion value at the end of 2027? Show all your calculations (2 marks)