You are buying an investment property for $362,854 today. Through research, you have determined that the value of the property is likely to grow at a rate of 7.8% per year, on average. How long until the value of the property grows to $528,707?

Q: Assume that you purchase a property for $2,000,000 and it generates $25,000 per month of rental…

A: Rate of return refer to the value of investment that is to be earned in a specified period of time…

Q: You just purchased a parcel of land for $10,000. If you expect a 12% annual rate of return on your…

A: Future value is that amount which will be require to paid at some specified period of time. It…

Q: u are able to invest $100 at the end of 1 year into an investment earning 6%. At the end of year 2,…

A: Future value of money increases with due to accumulation of interest over the period of time of…

Q: You are considering the purchase of real estate that will provide perpetual income that should…

A: T-bill rate is like Risk free Rate = 6%  Expected Market Return = 12%

Q: How much is the sum of the present value of the expected return over those periods

A: Cash Flows (Year 1-10) (CF) =  $15,000 per year Annual interest rate (r) = 5% Time Period (t) = 10…

Q: Using a financial calculator, You can buy property today for $2.1 million and sell it in 6 years for…

A: Given information,Purchase price:  millionSale price:   millionNumber of years:  yearsInterest rate:…

Q: You currently have a loan outstanding on one of your investment properties. The current balance of…

A: We have to find the incremental cost of refinancing. For that we will have to find the incremental…

Q: Assume that you purchase a property for $2,000,000 and it generates $15,000 per month of rental…

A: The income that is collected from an investment is then divided by the amount of time that the…

Q: You are thinking on purchasing some assets that will give you 5,000€ per year, starting in 5 years,…

A: In order to decide whether to purchase the asset we need to find out the present value of cash…

Q: A person has $ 100,000 annual income. The interest rate is 10%. This person is considering…

A: Assumptions and working notes :-                          In option a we can consume 60000 euro and…

Q: Your goal is to have $93,677. If you can earn 11.79% per year and you invest $11,573 today, how many…

A: The number of years required to reach the goal can be calculated with the help of future value…

Q: Assume that you purchase a property for $2,450,000 and it generates $195,000 per year of rental…

A: ANNUAL RATE OF RETURN   Annual rate of return is computed by deducting the cost of maintenance and…

Q: Suppose you want to purchase equipment costing $500 and which will give you a cash flow of $35 every…

A: Net present value is the capital budgeting technique used to evaluate the profitability of various…

Q: You invested $10,000 on January 1, 2018, at 7% interest compounded annually. You have not touched…

A: Future value is the future worth of a cash flow at a certain rate of interest and time period.…

Q: Today, you decide to invest $7,000 for 29 years. If you can earn 9.05 percent for the first 19 years…

A: Here, Invetsment Amount $ 7,000.00Time Period of Invetsment29Interest Rate for first 19…

Q: The property is current selling for $400,000. You have forecasted, at the end of the fifth year we…

A: Net Present Value (NPV) of a project is determined to understand the cost and benefit of the…

Q: Two years ago. XYZ invested $13,800. In 3 years from today, he expects to have $26,200. If XYZ…

A: Calculate the implied interest rate, Use the same interest rate to calculate the years  Using excel…

Q: Suppose that you purchase an investment property for $8 million If you purchased the property with a…

A: In finance, the term mortgage represents financial assistance provided by the bank to its customers…

Q: You are told that if you invest $10,900 per year for 12 years (all payments made at the end of each…

A: Annual Payment = pmt = $10.900Time = nper = 12 YearsFuture Value = fv = $670,000Present Value = pv =…

Q: You will invest in something that will give you a payment of $211 two times each year.  You plan to…

A: Step 1 An annuity is a contract that you have with an insurance provider that calls for periodic…

Q: An asset costs $7 million today. It can generate a $2 million income every 6 years, starting from…

A: An investment's profitability or success over a given time period is assessed using the annual rate…

Q: Your company plans to invest $20,000 at the end of each year or years 1 through 5, The company will…

A: Present Value: It represents the present worth of the future amount and is computed by multiplying…

Q: An investor has an opportunity to invest in a rental property that willprovide net cash returns of…

A: Calculation of the present value of the cash return is shown below:

Q: At the end of each year for the next 18 years you will receive cash flow of $3700 the initial…

A: The present value is the value of the sum received at time 0 or the current period. It is the value…

Q: The value of business, currently priced at 100000 Ria is expected to increase by 20% a year. After…

A: Using excel FV and NPER function

Q: How much time will it take you to accumulate $500,000, assuming you invest $15,000 today and $150 /…

A: The time value of money concept states that the value of a certain amount of money on the future…

Q: An investor plans to invest $500 a year and expects to get a 10.5% return. If the investor makes…

A: Formula to be used,   PV = P[1-(1+r)^-n]/r where, PV=Present value P=Principal amount r=Rate of…

Q: You have bought property today for $600,000. You have estimated that it will provide monthly net…

A: Implied rate of return Implied rate of return helps investors understand the return on investment…

Q: You are considering the purchase of real estate that will provide perpetual income that should…

A: Perpetual Income =$54000 Risk Free Rate = 6% Market Return = 9% Market Risk Beta = 1 Property Risk…

Q: ou just purchased a parcel of land for $54,000. To earn a 11% annual rate of return on your…

A: FV = PV * (1 + r)^nWhere FV = Future ValuePV = Present Value of Land = $54,000r = rate of interest =…

Q: Your home has a value today of $160,000. You expect prices to increase at 8% per year (compounded…

A: In case when the amount is expected to rise at different rates for different time interval, future…

Q: Suppose that annual income from a rental property is expected to start at P65,000 per year and…

A: Present equivalent refers to the current value of the amount that will be on some future date. It…

Q: You just purchased a parcel of land for $40,000. To earn a 9% annual rate of return on your…

A: Future value of a present amount The future value (FV) for a present value (PV) that earns annual…

Q: the NPV of the project? What is the IRR of the project?

A: Net present value is calculated by deducting the initial investment from the current value of cash…

Q: You are considering the purchase of a property today for $300,000. You plan to finance it with an 80…

A: Real estate investment involves the purchase, ownership, management, rental, or sale of real estate…

Q: And investor plans to invest $500 a year and expect to get a 10.5% return if the investor makes…

A: Future value refers to the value that an amount would assume at a future time period after…

Q: u own a lot in Key West, Florida, that is currently unused. Similar lots have recently sold for $1.8…

A: To protect yourself from a potential drop in land value, you want to purchase a financial instrument…

Q: If he is correct on the future price, did he make a wise investment?

A: Value of an investment increases with the period of time.  Also, the value of money at future point…

Q: An investment offers $2,500 per year for 8 years, with the first payment occurring one year from…

A:

Q: You will have $100,000 exactly 7 years from now. You began with an investment of $50,000 at Time…

A: The formula to calculate the fv is FV=Pmt[(1+i)n−1/i] Given: FV=$100,000 PMT=50,000 n=7

Real Estate

Real estate means ownership of land along with the assets and natural resources that exist on the land. These properties are in real/physical form which is tangible. Real estate simply means land or addition made to land permanently like constructing a residence or different buildings. People invest in real estate to either reside or for wealth creation. Many people investing in real estate further lend the place for occupation or businesses in return for a monthly payment.