标题: Alt Investments Question - Qbank [打印本页] 作者: noel 时间: 2011-7-11 19:35 标题: Alt Investments Question - Qbank
Consider a real estate investment that is 35% debt financed and 65% equity financed. The total mortgage cost for this property is 10% and the cost of equity financing is at a recent high of 13%. The capitalization rate for this investment as determined using the band-of-investments method is closest to:
A. 11.80%
B. 11.95%
C. 12.85%作者: cv4cfa 时间: 2011-7-11 19:35
I'm pretty sure Qbank is not correct in this case.作者: jacksparrow 时间: 2011-7-11 19:35
I refuse to use QBank for L2....appears absolutely garbage.作者: ap0258 时间: 2011-7-11 19:35
B) 11.95%
I don't think you need to calculate sinking fund factor because it gave you "total cost of mortgage". I beleive that includes the sinking fund factor. If they just gave you mortgage interest rate of 10%, then you would need to calculate sinking fund factor and more information would have been required.作者: firat 时间: 2011-7-11 19:35
11.95% . Need length of mortgage for sinking fund factor作者: xilinx_altera 时间: 2011-7-11 19:35
job71188 Wrote:
-------------------------------------------------------
> B) 11.95%
>
> I don't think you need to calculate sinking fund
> factor because it gave you "total cost of
> mortgage". I beleive that includes the sinking
> fund factor. If they just gave you mortgage
> interest rate of 10%, then you would need to
> calculate sinking fund factor and more information
> would have been required.
