What describes a mortgage payment schedule with a $20-$year amortization term?

a$.$ The total payment amount decreases each year, but the interest portion increases each successive year while the principal repayment component remains the same.

b$.$ The total payment amount increases each year, but the interest portion remains the same while the principal repayment component decreases.

c$.$ The total payment amount is the same each year, but the interest portion decreases each successive year while the principal repayment component increases.

d$.$ The total payment amount is the same each year, but the interest portion increases each successive year while the principal repayment component decreases.

True or False: The shorter the amortization period, the smaller the annual payments.

a$.$ True

b$.$ False

True or False: The length of the amortization term is the most important characteristic of a loan to all borrowers.

a$.$ True

b$.$ False

Income multiple analysis:

a$.$ Is a difficult standard valuation method

b$.$ Estimates property value by dividing next year's stabilized NOI by the price$-$to$-$NOI multiple

c$.$ Estimates property income

d$.$ None of these

True or False: The real estate industry's usage of cap rates reflects its historic linkage to the equities market.

a$.$ True

b$.$ False

The purchase price of an older building needs to be below replacement cost because:

a$.$ You will need to invest in significant cap ex to bring it up to standard and reinstate its competitiveness

b$.$ You will need to provide a significant amount of free rent

c$.$ High credit quality tenants never rent older buildings

d$.$ Lessons learned from Japan's Real Estate Market in the $1980\text{'}$s

e$.$ None of these

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