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Calculate capitalization rate use weighted average method

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Reference no: EM132961740

Problem a) Based on the following information, use the weighted average method to calculate the capitalization rate:

Loan-to-value ratio: 70%

Mortgage rate: 6.5% per annum, compounded annually

Equity dividend rate: 8.5% per annum, compounded annually

Problem b) If the property's annual net operating income is $300,000, calculate the marketvalue of the property.

Reference no: EM132961740

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