sha is considering buying a house while she is at University. She plans to live in the hou d also rent to her friends. The house will cost $350,000 to purchase and it has 4 bedroo e can rent). She will pay cash for the house! She estimates that she can earn $34000 pe rental income. She estimates that her expenses will be $19000 per year. At the end of 5- ars she estimates that she will be able to sell the house for $620,000. If she uses a MAR 6 compounded monthly, what is the present worth of her investment plan?
sha is considering buying a house while she is at University. She plans to live in the hou d also rent to her friends. The house will cost $350,000 to purchase and it has 4 bedroo e can rent). She will pay cash for the house! She estimates that she can earn $34000 pe rental income. She estimates that her expenses will be $19000 per year. At the end of 5- ars she estimates that she will be able to sell the house for $620,000. If she uses a MAR 6 compounded monthly, what is the present worth of her investment plan?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Alisha is considering buying a house while she is at University. She plans to live in the house
and also rent to her friends. The house will cost $350,000 to purchase and it has 4 bedrooms (3
she can rent). She will pay cash for the house! She estimates that she can earn $34000 per year
in rental income. She estimates that her expenses will be $19000 per year. At the end of 5-
years she estimates that she will be able to sell the house for $620,000. If she uses a MARR of
7% compounded monthly, what is the present worth of her investment plan?
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