Considering the purchase of an apartment complex

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Realtor Inc is considering the purchase of an apartment complex in Palm Beach that is priced at $5,000,000. It expects to receive a rental income of $600,000 each year from the apartments. It estimates that the maintenance and administrative costs will be $150,000 each year. Additionally, it expects to spend about $800,000 for repairs in 5 years. At the end of 10 years, it expects to sell the apartment complex for $7,000,000. If RPI requires a return of 10% on its investments, should it make this investment?

Reference no: EM131572914

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