A Property Is Financed with an 85% Loan-To-Value Ratio at 10

question 28

Multiple Choice

A property is financed with an 85% loan-to-value ratio at 10% interest over 25 years.What would the BTIRR_E on equity be estimated at,given that the BTIRR_p is 10.75%?

• A)10.1%
• B)10.4%
• C)15.0%
• D)13.2%

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Definitions:

Office Building

A structure designed primarily for the occupation of offices and workspaces for various businesses and professionals.

(Paid-In) Capital

The amount of money that a company has received from shareholders in exchange for shares of stock, contributing to the company's equity.

Capital Stock

The total amount of shares a company can issue, as authorized by its corporate charter.

Partnership

A legal form of business operation between two or more individuals who share management and profits.