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Please, answer for following questions: You’ve spent $10,000 searching for an investment property. Now, you’re considering...

Please, answer for following questions:

  1. You’ve spent $10,000 searching for an investment property. Now, you’re considering investing in a cottage near Brighton Beach. You can buy the house for $300,000 with cash, earn $12,000 per year in rent and pay $8,000 per year in HOA, taxes, and other expenses. Assume you’ll be able to sell the house in ten years for $400,000. Calculate in Excel the NPV (assume a reasonable discount rate) and IRR of this investment.
  2. Now, assume that you must spend $100,000 in year 10 to raise the house on stilts due to sea-level rise from a warming planet. What are the NPV and IRR in this scenario?
  3. Is the cottage still a good investment? Why?
  4. Please Use Excel and shows all formulas.

Thank you so much!

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