Annual income from rental property is expected to start

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Suppose that annual income from a rental property is expected to start at $1,000 per year and increases at a uniform amount of $50 each year after the first year for the 10-year expected life of the property. Assume an interest rate of 10%/year. Assume that the investment occurs at time zero (now) and that the annual income is first received at EOY one. What is the present value of this investment? Provide your cash flow diagram.

Reference no: EM13860633

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