Question

Please do it manually A client has requested advice on a potential investment opportunity involving an...

Please do it manually

A client has requested advice on a potential investment opportunity involving an income producing property. She would like you to determine the internal rate of return of the investment opportunity based on the following information:

Expected Holding Period: 3 years; End of first year NOI estimate: $5,000; NOI estimate in subsequent years will grow by 5% per year; The property is expected to be sold at the end of year 3: $20,000; Current market price of the property: $25,000.

Use discount rates of 15% and 16% (previously incorrect 14% and 15%) to solve for NPV, then solve IRR using the Trial and Error method.

Type your answer in the inline section. Show all mathematical steps the long way every step (no short form) to receive credit for this assignment (type in the inline section or upload your file).

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