[The information presented here applies to questions 12 -- 15]

(12) You have purchased a small multi-family building in Montclair, NJ for $2M. You expect that NOI in your first year of ownership will be $175,000, what is the initial cap rate?

(13) Your acquisition was financed with a 10-year loan form $1.5M offering a 5% interest rate and a 20-year amortization period. If payments are made on an annual basis, what is the mortgage interest deduction you receive in your first year of ownership?

(14) If the land value is assessed at $625,000, what is the depreciation allowance in your first year of ownership?

(15) If you are in a 25% marginal tax bracket and do not plan to make any capital expenditures in your first year of ownership, what is your tax liability in the first year?