Lenny, a real estate professional, has found a retail outparcel for sale for $5,000,000 for a client he is representing. Lenny's analysis suggests the property will be worth $7,000,000 in 2 years after the site's land use is reclassified to allow for a mixed use development. Before the client is willing to make an offer, she wants to know what the annual return will be. What is the annual rate of return on this investment? A) 18.32% B) 40% C) 6.13% D) 11.87%

Lenny, a real estate professional, has found a retail outparcel for sale for $5,000,000 for a client he is representing. Lenny's analysis suggests the property will be worth $7,000,000 in 2 years after the site's land use is reclassified to allow for a mixed use development. Before the client is willing to make an offer, she wants to know what the annual return will be. What is the annual rate of return on this investment? A) 18.32% B) 40% C) 6.13% D) 11.87%

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter2: The Domestic And International Financial Marketplace

Section: Chapter Questions

Problem 8P

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