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Questions 31-40 are four (4) points each. Your employer, Rubio LLC, is considering an investment in an office building that has the following cash flows:

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Questions 31-40 are four (4) points each. Your employer, Rubio LLC, is considering an investment in an office building that has the following cash flows: Purchase in Year ............... $-2.750,000 Year 1.................. 220,000 Year 2................ 226,000 Year 3................ 250,000 Year 4......... ..... 255,000 Year 5........ 230,000, and a sale @ $3,290,000 takes place EOY 5 The company's weighted average cost of capital that they use as their discount rate for such calculations is 12% 34. The Dow Jones Industrial Average is made up of a. 10 companies b. The largest 1,000 companies in the world c. 30 blue chip companies, not all of which are heavy industrial companies d. 100 companies with large cap market value In the Rubio LLC example above, assume that the company bought the office building using 70% mortgage debt at an interest rate of 4.00% over 240 months. 35. What would be the monthly debt service on the office building? a. $9.120 b. $4,555 c. $6,890 d. $11,665

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