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Use the following information to solve for both the levered and unleved NPV & IRR Please note: mortgage and income numbers are to be annual numbers, not monthly

Use the following information to solve for both the levered and unleved NPV & IRR Please note: mortgage and income numbers are to be annual numbers, not monthly

Essentials Of Investments
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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Use the following information to solve for both the levered and unleved NPV & IRR Please note: mortgage and income numbers are to be annual numbers, not monthly Potential Investment Purchase Price Years: LTV Rate Ongination Expenses ΝΟΙ Required Return Levered Required Return Un-Levered Expected Price Appreciation) Selling expenses Expected holding period Price: Mortgage Loan Exp CFO Loan Information N IN 0 $700,000.00 30 80.0% 7.0% 3.0% $75,000.00 13,0% 10.0% 4.0% 5.0% 2 100% PV PAID ANNUALLY of the loan amount Per Year Years of the sale price Years NOI MTG Pynt CF1 PMT EV NOI MTG Pymt Net Sales Price: Mortgage Payoff CF2 Levered CF-0 CF-1 CF-2 NPV = IRR = Un-Levered CF-0 CF-1 CF-2 NPV = IRR= Equity Reversion Sale Price Selling Expenses Net Sales Price Mortgage Payoff BTER
Transcribed Image Text:Use the following information to solve for both the levered and unleved NPV & IRR Please note: mortgage and income numbers are to be annual numbers, not monthly Potential Investment Purchase Price Years: LTV Rate Ongination Expenses ΝΟΙ Required Return Levered Required Return Un-Levered Expected Price Appreciation) Selling expenses Expected holding period Price: Mortgage Loan Exp CFO Loan Information N IN 0 $700,000.00 30 80.0% 7.0% 3.0% $75,000.00 13,0% 10.0% 4.0% 5.0% 2 100% PV PAID ANNUALLY of the loan amount Per Year Years of the sale price Years NOI MTG Pynt CF1 PMT EV NOI MTG Pymt Net Sales Price: Mortgage Payoff CF2 Levered CF-0 CF-1 CF-2 NPV = IRR = Un-Levered CF-0 CF-1 CF-2 NPV = IRR= Equity Reversion Sale Price Selling Expenses Net Sales Price Mortgage Payoff BTER
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