Rami is purchasing a retail center for R14 million. Expected first-year net operating income for this center is R1.25 million. Butcher's Finance will provide 25-year, 8.75 percent fixed rate financing with monthly payments, a maximum loan-to value ratio of 80 percent, and a minimum debt-coverage ratio of 1.30. Based on these terms, what is the maximum loan amount Rami can expect?

A. R11,200,000

B. R9,746,254

C. R116,955,045

D. R10,136,104

E. R16,471,169

Carol would like to purchase a shopping center property. She has determined that the current market vacancy rate is 6 percent, and that operating expenses will run at about 10 percent of effective gross income. The prevailing market cap rate is 9 percent.

The first shopping center she has analyzed has 35,000 square feet which rents at $15.50 per square foot. The second shopping center she is considering 40,000 square feet and rents for $14.00 per square foot.

______ 3. Effective Gross Income for the FIRST center is?

A. $ 509 950

B. $ 542 500