Question
9-32 An investor is considering buying some land for $100,000 and constructing an office building on it. Three different buildings are being analyzed. Building
9-32 An investor is considering buying some land for $100,000 and constructing an office building on it. Three different buildings are being analyzed. Building Height 2 Stories 5 Stories 10 Stories Cost of building (excluding cost of land) Resale value* of $400,000 $800,000 $2,100,000 200,000 300,000 400,000 land and building at end 20-ycar analysis pericd Annual rental 70,000 105,000 256,000 income after all erating expenses have been deducted *Resale value to be considered a reduction in cost, rather than a benefit. Using benefit-cost ratio analysis and an 8% MARR, determine which altemative, if any, should be selected.
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Managerial Decision Modeling With Spreadsheets
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