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. You are a real estate analyst asked to do an NPV analysis on a hypothetical property investment with the discount rate to be determined.

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. You are a real estate analyst asked to do an NPV analysis on a hypothetical property investment with the discount rate to be determined. You are given an assumed current purchase and future sale price, along with all interim cash flow amounts. While waiting for the discount rate you decide to do an IRR calculation and get 8.5%. Shortly afterwards you are asked to complete the NPV calculation using a discount rate of 9.5%. What would you expect for your NPV calculation for this investment? Note: no calculation required. a. NPV would negative b. NPV would be positive c. NPV would be equal to $0 d. Not enough information to answer . From a tax standpoint when selling a commercial property in which you have substantial capital appreciation, the primary benefit of using an installment sale under the tax code rather than receiving all proceeds up front is that you as the seller pay no taxes ever on the gain - even after the final installment is received. a. True b. False

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