The following information about an apartment building applies to the next 12 questions: Total Value : $1,000,000 Number of units: 20 Rent/unit/year: $8,000 Expected Selling Price at the end of 5 years: $1,500,000 Selling Expenses: 10% of selling price Building Value / Total Value: 55% Holding period: 5 years Vacancy rate: 5% Maintenance: $7,000/year Property taxes: $4,000/year Management fees: $6,000/year Property Insurance: $1,500/year Utilities: $1,500/year Debt Service: $100,000/year 1st year Mortgage Interest: $90,000 Loan Balance at the end of year 5: $800,000 Your marginal income tax rate: 28% Depreciation recapture tax rate: 25% Capital Gain Tax Rate: 20%