Real Estate investor borrowed Ksh 10million to invest in an asset at an interest rate of 10% p.a for 30 years. Calculate: I). Tha annual payment ii). The monthly payment iii). If the asset is expected to generate a return of Ksh 100000 per month. Advise the investor whether the investment in the asset is viable

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 41P
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Real Estate investor borrowed Ksh 10million to invest in an asset at an interest rate of 10% p.a for 30 years. Calculate:

I). Tha annual payment

ii). The monthly payment

iii). If the asset is expected to generate a return of Ksh 100000 per month. Advise the investor whether the investment in the asset is viable

iv). Prepare a loan amortization schedule for the first ten years

v). What other factors will you advise the investor to consider

 

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