29. A potential investor in a property desires a 14% return but the long of property is expected to be 9% during the holding period. IF the observed in the market as 4%, what LTV will obtain the investor h a. 50% b. 60%
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- Assume you have the following asset and liability in your balance sheet Asset - Bond AModified Duration = 1.5 yearsValue = RM1 million Liability - Bond BModified Duration 2.6 yearsValue = RM2 million a. Calculate the duration gaps?b. What is the expected change in Net worth if interest increases by 1%?c. What should or could you to achieve immunised balance sheet?Assume you have the following asset and liability in your Balance Sheet: Asset - Bond A Modified Duration = 2.6 years Value = RM1.5 million Liability - Bond B Modified Duration = 3.1 years Value = RM1.0 million a. Calculate the duration gap. b. What is the expected change in Net Worth if interest increases by 1%? Assume previous interest is 10% c. What should or could you to achieve immunised balance sheet? Note: Please show all workings.Assume you have the following asset and liability in your Balance Sheet: Asset - Bond A Modified Duration = 2.6 years Value = RM1.5 million Liability - Bond B Modified Duration = 3.1 years Value = RM1.0 million a. Calculate the duration gap. b. What is the expected change in Net Worth if interest increases by 1%? c. What should or could you to achieve immunised balance sheet? Note: Please show all workings.
- Assume you have the following asset and liability in your Balance Sheet:Asset - Bond AModified Duration = 2.6 yearsValue= RM1.5 millionLiability - Bond BModified Duration = 3.1 yearsValue= RM1.0 million duration gap is 0.53 years, net worth reduce by 8000. What should or could you to achieve immunized balance sheet?Assume you have the following asset and liability in your Balance Sheet:Asset - Bond AModified Duration = 2.6 yearsValue= RM1.5 millionAAFARLiability - Bond BModified Duration = 3.1 yearsValue= RM1.0 milliona. Calculate the duration gap. b. What is the expected change in Net Worth if interest increases by 1%?attachment. calculation step by step1. 2. 3. property A time 0 time net operating income and time 0 purchase price 1 2 3 4 5 10 6 7 8 9 time If the discount rate declines by 200 basis points (from 14% to 12%) the NPV of the investment would go from being negative to positive. O True O False If the appropriate discount rate for a real estate investors NPV analysis is the yield on 10-year treasury securities plus 400 basis points then the following property would have had a higher NPV on 7/28/2021 than on 7/27/23. O True O False 0 1 2 3 4 5 6 7 8 9 10 property A 0 1 2 3 4 5 ($2,000,000) $100,000.00 $100,000.00 $275,000.00 $275,000.00 $275,000.00 $275,000.00 $275,000.00 $275,000.00 $275,000.00 $2,775,000.00 6 7 8 9 10 discount rate 14% net operating income and time 0 purchase price net operating income and time 0 purchase price ($65,000,000) $15,000,000.00 $15,000,000.00 $15,000,000.00 $15,000,000.00 $15,000,000.00 $15,000,000.00 $15,000,000.00 $15,000,000.00 $15,000,000.00 $90,000,000.00 ($2,000,000) $0.00 $0.00…
- 76. If 60% financing is available on a certain income property at a loan constant of 11%, what equity cash-on-cash return is available where the overall rate is 10.6%? A: 5.0% B: 10.0% C: 6.5% D: 1.5%You currently have 50% of your wealth invested in a risk-free asset and 50% in the four assets below Asset i 1 2 3 4 Expected Return on Asset i (%) 7.6 12.4 15.6 18.8 0.2 0.8 Bi 21.3 1.6 Percentage invested in Asset i (%) 10 10 10 20 If you want an expected rate of return of 12%, you can obtain it by selling some of your holdings of the risk-free asset and using the proceeds to buy the equally weighted market portfolio. If this is the way you decide to revise your portfolio, what will the rest of weights in your portfolio be? If you hold only the risk-free asset and the market portfolio, what set of weights would give you an expected return of 12%?An investor wants to invest in the Asset whose market rate of return is 14%, and the industry risk factor(Asset beta) is 0.30 . Required: Compute the required rate of return from the asset per annum and assuming the asset is to be financed by a loan at 9% per annum and advise the investor if the investment is viable
- You are given the following information: Risky Asset Risky Asset Risk-free Asset Asset X Y Expected Return 9.6% 7.2% 3.5% Beta 1.63 1.09 Your Investment $5000 $3000 $2000 Alex's Investment $6000 $6000 $6000 Using the Capital Asset Pricing Model, the required return of your investment is 8.6%. Determine the alpha of Alex's investment. Possible Answers A Less than 0% B At least 0%, but less than 1% C At least 1%, but less than 2% D At least 2%, but less than 3% At least 3%13. Consider the following possible returns over the next year on an asset Return probability –£40 0.5 £40 0.5 What is the expected monetary return of this asset over the next year?Q. 12. Consider a Financial Institution with the following assets and liabilities. Asset A has a maturity of 2 years and a market value of $50,000 and asset B has a maturity of 7 years and a market value of $80,000. Liability A has a maturity of 3 years and a market value of $40,000 and liability B has a maturity of 9 years and a market value of $10,000. What is the maturity gap of this FI (round your answer to two decimals)? a. 0.88 years. b. - 5 years. c. 5 years. d. 3.88 years. e. -1.47 years
