How would you structure the analysis of value of your share

Assignment Help Microeconomics
Reference no: EM131524473

Question: Underwater partnership. You are acting in a consulting capacity advising a limited partner in a real-estate partnership. The partnership has negative income because of high vacancy rates and discounts on lease rates in the current soft market. The general partner would like to consolidate ownership, and is asking your client to give up his interest in the partnership; in return, the general partner will not ask him to contribute capital to the partnership. The general partner claims that the value of the partnership real estate is negative and that your client should be happy to turn his interest over to him. In fact, he has threatened that if your client doesn't cooperate, he will sue him in order to close out the limited partnership and convert the properties to another use. In addition, the general partner has threatened to discontinue his recent practice of making up the mortgage shortfall.

In that event, the bank (on whose board he sits) would foreclose on the property. Your client would perhaps be willing to fund his share of the mortgage shortfall, in the interest of maintaining his share in a property that he believes will come back to profitability. The vacancy rates and discounts are likely to change when the local economy improves-some leading indicators of improvement seem to have already appeared. If this case goes to court, how would you argue before the judge that your client's share is worth some positive amount? How would you structure the analysis of the value of your share? Just lay out the approach, rather than look for a specific number, but do argue convincingly that the property is not worthless.

Reference no: EM131524473


Write a Review


Microeconomics Questions & Answers

  Robert devlin and neil parish are portfolio managers

Robert Devlin and Neil Parish are portfolio managers at the Broward Investment Group. At their regular Monday strategy meeting, the topic of adding international bonds to one of their portfolios came up. The portfolio, an ERISA-qualified pension acco..

  What is the interpretation of profit here

What are the interpretations of "marginal benefit" and "marginal cost" here? Calculate marginal benefit and marginal cost per each 10% increase in the rate of inoculation. Write your answers in the table.

  What is the demand for central bank money

Find the equilibrium interest rate by setting the demand for central bank money equal to the supply of central bank money.

  How would you evaluate the riskiness of a security

Discussion question: How would you evaluate the riskiness of a security? It has to be a 1400 - to 1700 words and 5 references not from blog, wiki, etc

  What should it do to interest rates

Normal 0 false false false EN-US X-NONE X-NONE MicrosoftInternetExplorer4 ..

  Money demand shocks will not affect the output level

Money demand shocks will not affect the output level so long as the Fed pegs interest rates. True or false? Use an IS-LM diagram to explain your answer.

  The quantity supplied and p is the price per lot of paper.

Qd=160,000-2000P Qs = 40,000+2000P MEC=.0006Qs. Qd is the quantity lots of paper Qs is the quantity supplied and P is the price per lot of paper.

  Applications of statistical techniques to economic data

Develop and discuss a relationship that can be modeled with a simple regression - State the model in mathematical terms and estimate the model and interpret the meaning of the coefficient estimates.

  Is he counted as part of the unemployed group

Michael is fifteen and works twenty hours a week babysitting his neighbor's kids. Is he counted as part of the unemployed group

  Write the factors which might influence the countrys

list the factors that might influence a countrys exports imports and trade balance. suppose that bill a resident of the

  What is the sharpe ratio on a portfolio of us stocks

What is the Sharpe ratio on a portfolio of US Stocks and what is the lowest value for such that these numbers from the data are consistent with equation (2)?

  Determine the steps that the federal reserve should take

Determine the steps that the Federal Reserve should take to help stabilize our economy. Next, explain how each of the following variables will be affected by proposed steps

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd