An investor is considering buying a small apartment block for $945,000 that genentes net income...
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An investor is considering buying a small apartment block for $945,000 that genentes net income of $90,000/y year. The building has not been maintained very well, and in addition to the reqular maintenance, improvements will cost an additional $55,000 after the first year, and ahother 535,000 after the second year (assume that revenue is still being generated). Consider the improvements further investment requirements. The investor wants to keep the building for ten years and then sell it for a salvage vale of \$1.45M. He has other investment opportunities, and requires a minimum return of 10%. Would you recommend investing in this property given the investor's requirements? As part of your analysis, determine the IRR, NPV, and Pl at the investor's required rate of return. Use a table format, formulas, the interpolation method, or any combination to determine your solution
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