Debt service is twice as much as the operating expenses

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1. Assume a property has a potential gross income that is one tenth of its purchase price. It has no vancacies. Operating expenses are 30% of effective gross income. Debt service is twice as much as the operating expenses. If cash flows before taxes are 10000 what price was paid for the property A. 100,000 B. 1,000,000 C. 300,000.

2. Stock S is expected to return 12 percent in a boom, 9 percent in a normal economy, and 2 percent in a recession. Stock T is expected to return 4 percent in a boom, 6 percent in a normal economy, and 9 percent in a recession. There is a 10 percent probability of a boom and a 25 percent probability of a recession. What is the standard deviation of a portfolio which is comprised of $4,500 of Stock S and $3,000 of Stock T?

Reference no: EM131830114

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