You are considering the purchase of a quadruplex apartment building. Effective gross income $($EGI$)$ during the first year of operations is expected to be $$33,600($ $$700$ per month per unit$).$ First$-$year operating expenses are expected to be $$13,440($at $40$ percent of EGI$).$ Ignore capital expenditures. The purchase price of the quadruplex is $$200,000.$ The acquisition will be financed with $$60,000$ in equity and a $$140,000$ standard fixed$-$rate mortgage. The interest rate on the debt financing is $8$ percent and the loan term is $30$ years. Assume, for simplicity, that payments will be made annually and that there are no upfront financing costs.

a$.$ What is the overall capitalization rate?

b$.$ What is the effective gross income multiplier?

c$.$ What is the equity dividend rate $($the before$-$tax return on equity$)?$

d$.$ What is the debt coverage ratio?

e$.$ Assume the lender requires a minimum debt coverage ratio of $1\mathrm{.}2.$ What is the largest loan that you could obtain if you decide that you want to bor