A real estate investment has the following expected cash flows: Year

A real estate investment has the following expected cash flows:

                        Year           Cash Flows
                          1              $9,000
                          2               13,000
                          3               18,000
                          4               25,000

The discount rate is 12 percent. What is the investment’s present value? Round your answer to 2 decimal places; for example 2345.25.

Expert Solution

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

jeff jeffy answered 1 year ago

A real estate investment has the following expected cash flows: Year Cash Flows 1 $7,000 2...

A real estate investment has the following expected cash flows: Year Cash Flows 1 $7,000 2 17,000 3 22,000 4 22,000 The discount rate is 11 percent. What is the investment’s present value? Round it to two decimal places, i.e., 1234.45.

A real estate investment has the following expected cash flows: Year 0 Year 1 Year 2...

A real estate investment has the following expected cash flows: Year 0 Year 1 Year 2 Year 3 Year 4 Cashflow 10,000 25,000 50,000 35,000 The discount rate is 9%. What is the investment’s value 4 years from now? Select one: a. $ 132,152 b. $103,700 c. $ 113,345 d. $120,000 e. $130,757

The cash flows below contain the cash flows from a completed real estate investment analysis. Based...

The cash flows below contain the cash flows from a completed real estate investment analysis. Based on the information in the cash flows what is the internal rate of return of the before-tax unlevered cash flows? Purchase Price $4,569,231 Loan Amount $3,198,462 Year 1 2 3 4 5 Leasable Space 30,000 30,000 30,000 30,000 30,000 Average Rent $20 $21.00 $22.05 $23.15 $24.31 Potential Gross Income $600,000 $630,000 $661,500 $694,575 $729,304 Vacancy and Collection Losses 10% 10% 10% 10% 10% ($60,000)...

Real estate investment is a type of alternative investments. An analyst has collected the following expected...

Real estate investment is a type of alternative investments. An analyst has collected the following expected cash flows about a project: Year Cash Flows 1 $10,000 2 25,000 3 50,000 4 35,000 The initial cost is $85,000. The discount rate is 8.125 percent. What is the investment's present value? a. $13,700 b. $18,200 c. $12,400 d. $16,118 e. None of above

If an investment costing $2,000 is expected to generate real cash flows of $900 p.a. for...

If an investment costing $2,000 is expected to generate real cash flows of $900 p.a. for three years and prices are expected to increase at a rate of 10% p.a., what is the real required rate of return if the nominal rate of return is 15%? Select one: a. 6% b. 5% c. 1.05% d. 4.55%

You are presented with a real estate investment with cash flow in year 1 of $100,000,...

You are presented with a real estate investment with cash flow in year 1 of $100,000, increasing by $5,000 per year through year 5. And, you estimate you can sell the deal at the end of the 5th year for $1,250,000. If your discount rate is 12%, should you buy the deal at the $1,100,000 asking price? A) Yes, because the IRR is a positive 9.34% B) No, because the NPV is a negative $33,455 C) Yes, because the NPV...

An investment is expected to produce the following annual year-end cash flows: year 1: $5,000 year...

An investment is expected to produce the following annual year-end cash flows: year 1: $5,000 year 4: $5,000 year 2: $1,000 year 5: $6,000 year 3: $0 year 6: $863.65 The investment will cost $13,000 today. I got that IRR is 10% Prove your answer for IRR by showing how much of each year’s cash flow is recovery of the $13,000 investment and how much of the cash flow is return on investment. (Hint: See Exhibit 3–13 and Concept Box...

A project has expected cash flows of $55 next year (year 1). These cash flows will...

A project has expected cash flows of $55 next year (year 1). These cash flows will grow at 6% per year through year 6. Growth from year 6 to 7 will be -2%, and this negative growth will continue in perpetuity. Assume a discount rate of 8%. What is the present value today (year 0) of these cash flows? DO BY HAND

What is the payback period for the investment project that has the following cash flows? Year...

What is the payback period for the investment project that has the following cash flows? Year Cash Flows 0 -65,209 1 24,853 2 27,977 3 23,774 4 25,436

Huggins Co. has identified an investment project with the following cash flows. Year Cash Flow...

Huggins Co. has identified an investment project with the following cash flows. Year Cash Flow 1 $ 900 2 1,290 3 1,550 4 1,725 If the discount rate is 7 percent, what is the present value of these cash flows? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Present value $ What is the present value at 20 percent? (Do not round intermediate calculations and round your answer to 2 decimal places,...

Question