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You have been approached to purchase a rental property and have the following information: -Rent $750/month (assume a single end of year payment) -Taxes $1,200/year -Insurance $600/year -Maintenance $2,400/year -Salvage value = $100,000 -Useful life 20 years 1. Draw the timeline 2. Determine how much you would be willing to pay for this investment at 8% marginal attractive rate of return. 3. Modify the timeline to reflect that you were able to borrow 2/3 of the initial price at 4% interest. The timeline should also reflect that it costs $2,000 for the loan origination fees. 4. What is the rate of return on your investment now? use excel.

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M9439996

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