William has received an inheritance of $200 000 and is considering what he should do with the money. He is choosing between purchasing some original Marvel comics to go with his collection or putting the money towards a small investment property worth about $400 000 (currently tenanted for rent of $380 a week). William owns his own home (worth $680 000) but really needs another source of income because he is planning to retire soon.

William has told you that he does not like taking risks with money and is a fairly conservative investor. He is concerned about borrowing an additional $200 000 to assist with purchasing the investment property. William thinks it might be safer to purchase the comics because he believes they will be easy to sell when he needs some extra cash and that it will not be affected by changes in the interest rate. He will also be able to enjoy reading the comics when he retires.

Discuss the possible outcomes of each investment to William. Where possible, support your answer with calculations.