You have an opportunity to acquire a property from First Capital Bank. The bank recently obtained the property from a borrower who defaulted on his loan. First Capital is offering the property for $200,000. If you buy the property you will haveto (1) spend $10,500 on various acquisition related expenses and (2) exactly $2,000/month during the next 12 months for repairs in order to prepare for sale. Because First Capital Bank would like to sell the property as soon as possible, it is willing to provide 90% LTV mortgage at 8% for one year interest only. You believe the property will sell for $270,000 at the end of oneyear. You will incur a 6% in selling costs. what isyou expected annual return on this investment? PV PV FV PMT FV PMT Is this a good investment and why? What counteroffer would you consider making First Capital and why? You have an opportunity to acquire a property from First Capital Bank. The bank recently obtained the property from a borrower who defaulted on his loan. First Capital is offering the property for $200,000. If you buy the property you will haveto (1) spend $10,500 on various acquisition related expenses and (2) exactly $2,000/month during the next 12 months for repairs in order to prepare for sale. Because First Capital Bank would like to sell the property as soon as possible, it is willing to provide 90% LTV mortgage at 8% for one year interest only. You believe the property will sell for $270,000 at the end of oneyear. You will incur a 6% in selling costs. what isyou expected annual return on this investment? PV PV FV PMT FV PMT Is this a good investment and why? What counteroffer would you consider making First Capital and why