Assume that you purchase a property for $500,000 and it generates annual cash flows of $30,000 in Years 1-3; and $75,000 in Years 4 & 5.  You are able to sell it at the end of Year 5 for $600,000.  Calculate the IRR for this investment property.

Personal Finance
13th Edition
ISBN:9781337669214
Author:GARMAN
Publisher:GARMAN
Chapter16: Real Estate And High-risk Investments
Section: Chapter Questions
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Assume that you purchase a property for $500,000 and it generates annual cash flows of $30,000 in Years 1-3; and $75,000 in Years 4 & 5.  You are able to sell it at the end of Year 5 for $600,000.  Calculate the IRR for this investment property.

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