Question
You can buy property today for $3.9 million and sell it in 5 years for $4.9 million. a.If the interest rate is 8%, what is
You can buy property today for $3.9 million and sell it in 5 years for $4.9 million.
a.If the interest rate is 8%, what is the present value of the sales price?
b.Is the property investment attractive to you?
c.What is the present value of the future cash flows, if you also could ear $290,000 per year rent on the property? The rent is paid at the end of each year.
d.Is the property investment attractive to you now?
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Multinational Business Finance
Authors: David K. Eiteman, Arthur I. Stonehill, Michael H. Moffett
14th edition
133879879, 978-0133879872
