SOLUTION: Morgan Washington invested $525,000 in a small office building. He plans to hold the property for 20 years. He feels that he can expect an average monthly rental payment of $4,250.
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Question 290036: Morgan Washington invested $525,000 in a small office building. He plans to hold the property for 20 years. He feels that he can expect an average monthly rental payment of $4,250. He holds a mortgage on the property for 5.75% and will use a 7.5% interest rate as the minimum desired rate of return for the investment. Calculate the net present value of the investment.
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