Question

You would like to know the fair market value of a house that you are planning...

You would like to know the fair market value of a house that you are planning to buy. You think that you can rent out the house starting one month from now for $8095 per month until you sell it. Every month the rent will go up by 0.15%. The discount rate is 6.0% APR compounded monthly. In 20 years from now, you will sell the house for $2 million.

What is the present value of the payments that you stand to receive, including rent and sale price? Ignore taxes and mortgage costs.


Select one:

a. 1915845

b. 1907487

c. 1899392

d. 1939867

e. 1931772

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