R$10$

Problem $12-33$ CAPM and Valuation $($LO$3)$

$10$ points

You are considering the purchase of real estate that will provide perpetual income that should average $$52,000$ per year. How much will you pay for the property if you believe its market risk is the same as the market portfolio's? The T$-$bill rate is $5\%,$ and the expected market return is $10\mathrm{.}0\%.$

Property value