If the Market Value Cap Rate Based on NOI) on a Certain

question 2

Multiple Choice

If the market value cap rate based on NOI) on a certain type of property is 11%, capital improvement expenditures are typically 1% of property value per year, and you expect the property to appreciate at 3% per year, what discount rate total return) should be applied to determine the market value in a multi-year DCF analysis?

• A) 3%
• B) 10%
• C) 11.5%
• D) 13%
• E) 11%

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Definitions:

NIMBY

Short for “not in my back yard”; originally referred to protests aimed at shifting undesirable activities onto those with less power; now sometimes used without negative connotations to describe local environmental activists.

Nuclear Waste

Radioactive byproducts resulting from the operation of nuclear reactors, research, and medical procedures, requiring careful disposal to avoid environmental harm.

Mainstream Environmentalism

A movement advocating for the sustainable management of natural resources and protection of the environment within the context of existing societal norms and policies.

Green Party

A U.S. political party established in 1984 to bring political attention to environmentalism, social justice, diversity, and related principles.