You are considering the acquisition of a small office building. The purchase price is $$575,000.$ Seventy percent of the purchase price can be borrowed with a $30-$year, $4\mathrm{.}5$ percent mortgage. Payments will be made annually. Up$-$front financing costs will total three percent of the loan amount. The expected before$-$tax cash flows from operations$--$assuming a $5-$year holding period$$are as follows:

Year BTCF

$1$ $$51,800$

$255,600$

$363,200$

$468,700$

$5$ $$73,800$

The before$-$tax cash flow from the sale of the property is expected to be $$225,000.$ What is the net present value of this investment, assuming a $9$ percent required rate of return on levered cash flows $($rounded to $Thousands$)?$

Excel

Question $30$ options:

a$)$

$$386,000$

b$)$

$$208,000$

c$)$

$$240,000$

d$)$

$-$$$189,000$

e$)$

$$213,000$

f$)$

$$185,000$