You acquire land for $100,000 and sell it after five years for $150,000. a) What was the

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You acquire land for $100,000 and sell it after five years for $150,000.

a) What was the annual rate of appreciation in the value of the land?

b) Each year you paid $2,000 in property tax, $300 for liability insurance, and $700 for upkeep (e.g., mowing). What was the true annualized return on the investment?

c) If there was also a 5 percent commission on the sale, what was the annualized return on the investment?

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Investments An Introduction

ISBN: 978-0324561388

9th Edition

Authors: Herbert B Mayo

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Question Posted: Jun 26, 2012 07:13 AM

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You acquire land for $100,000 and sell it after five years for $150,000. a) What was the

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a The annual rate of return is 1000001 r 5 150000 1 r 4 150000100000 1500 1500 is the interest facto...View the full answer

Investments An Introduction

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