The last eight questions are based on the following data: An Office building is listed for sale at $500,000. You can borrow 80% at 6% interest amortized monthly for a 20 year term and put 20% down. Your required unleveraged IRR is 10% and you want to use a 9% terminal cap rate. You plan a five year holding period after the purchase. You have calculated the annual pre-debt service NOI for each year as: Yr. 1 = $40,000 Yr. 2 = $41,000 Yr. 3 = $42,000 Yr. 4 = $43,000 Yr. 5 = $44,000 Yr. 6 = $45,000 1. Remember you plan on a five year holding period. What is the unleveraged IRR indicated? 2. Using your required 10% IRR, what is the NPV? 3. Using debt financing, what is the Year 5 loan balance? 4. What is the Year 1 before tax cash flow (Equity Dividend)? 5. What is the Year 1 Equity Dividend Rate? 6. What is the Year 1 Debt Coverage Ratio (DCR)? 7. What is the leveraged IRR indicated? (Ctrl)