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Question: A person plans to purchase a rental house which promises to provide $9000 in rental income at the end of each year, but require $2500 in expenditures at the end of each year for taxes, insurance and repairs. In addition the house will need a new furnace at the end of Year 5 at a cost of $7000. If the person expects to be able to sell the house at the end of year 11 for $150,000 at the end of 11 years of successsfully renting the house, what is the most the person should be willing to pay for the if the person's opportunity cost of money is 4%?

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