Suppose That Examination of a Pro Forma Reveals That the Fifth

Multiple Choice

Suppose that examination of a pro forma reveals that the fifth year net operating income (NOI) for an income producing property that you are analyzing is $138,446 (you can assume that this cash flow occurs at the end of the year) . If you estimate the projected rental growth rate for the property to be 5% per year, determine the projected sale price of the property at the end of year five if the going-out capitalization rate is 9%.

A) $988,900.00
B) $1,465,037.00
C) $1,538,289.00
D) $1,615,203.00