1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
olga_2 [115]
3 years ago
9

A property was purchased by an investor. The property is expected to produce $200,000 of annual net operating income in year 1;

increasing $20,000 every year thereafter. The owner intends to sell the property at the end of year 5.
Assuming the bank requires a 1.25 debt coverage service ratio based on the expected first year NOI, what is the maximum monthly mortgage payment?
Business
1 answer:
weqwewe [10]3 years ago
3 0

Answer:

$13,333.33

Explanation:

Debt service coverage ratio = Net operating income in year 1 / Annual debt service

Annual debt service = Net operating income in year 1 / Debt service coverage ratio

Annual debt service = $200,000 / 1.25

Annual debt service = $160,000

1 years = 12 months

Monthly mortgage payment = Annual debt service / 12 months

Monthly mortgage payment = $160,000 / 12

Monthly mortgage payment = $13333.33333333333

Monthly mortgage payment = $13,333.33

So,  the maximum monthly mortgage payment is $13,333.33.

You might be interested in
A contingency reserve is money assigned to the project and allocated for identified risks for which contingent responses are dev
Rudik [331]

Answer:

The correct answer is letter "A": True.

Explanation:

Contingency reserves are funds that companies save to face economic hardships. In some cases, those negative situations can be expected while in some other cases they cannot -such as acts of God. Contingency plans come along with the contingency reserve to have an idea of what the company is going to do with the funds.

3 0
4 years ago
Sue now has $490. How much would she have after 8 years if she leaves it invested at 8.5% with annual compounding?
Alina [70]

Answer:

c.$941.10

Explanation:

Calculation for How much would she have after 8 years

Using this formula

FV = PV(1+i)^n

FV represent future value

PV represent present value

i represent interest rate

n represent number of periods

Let plug in the formula

FV = 490(1 + .085)^8

FV= $941.10

Therefore How much would she have after 8 years will be $941.10

3 0
3 years ago
Taylor needs a natural resources in his venture to make his enterprise possible. Which of the following isn't considered a capit
Rina8888 [55]

<u>Answer:</u>

<em>The factors of production typically include land, labor, capital, entrepreneurship, and the state of technological progress.</em>

<u>Explanation:</u>

In economics, capital typically refers to money. But money is not a factor of production because it is not directly involved in producing a good or service.

Instead, it facilitates the processes used in production by enabling entrepreneurs and company owners to purchase capital goods or land or pay wages. For modern mainstream economists, capital is the primary driver of value.

8 0
3 years ago
You are the manager of a firm that produces products X and Y at zero cost. You know that different types of consumers value your
arlik [135]

Answer and Explanation:

a)

If you charge $40 for X then everyone will buy as everyone is willing to pay atleast $40. this means all three groups buy that is 3*1000 buyers.So profit from X = 3000*40= $120,000

And since everyone is willing to willing to pay atleast $60 for Y again all three groups will buy so profit from Y =3000*60=$180,000

profits=$300,000

b)

If you charge $90 and $160 for X and Y respectively you will have only 1000 buyers for each product as others are unwilling to pay this much.

So profits = 1000*90 + 1000*160=$250,000

c)

for a bundle of X and Y buyers are willing to pay a total of $150, $210 and $200 across the three categories.

So everyone will buy a bundle of 1 X and 1 Y.

profits = 150*3000= $450,000

d)

If you charge $210 only the second will buy as they are willing to pay that much so profits =1000*210=$210,000

Also by selling X at $90 group 1 will buy X; profits=1000*90=$90,000

and by selling Y at $160 group 3 will buy Y; profits=1000*160=$160,000

total profits =$460,000

8 0
3 years ago
What are renewable energy sources?
Molodets [167]

Energy sources that will never run out. Such as, light, air, and water. But it can be ruined. I didnt Google any of this. Please give me brainliest, I just need one more to lvl up!

3 0
3 years ago
Read 2 more answers
Other questions:
  • According to Scott, the chief operating officer of Barcelona Restaurant Group, the only way a business can ensure to have enthus
    14·1 answer
  • A city government imposes a proportional income tax on all people who earn income within its city limits. In​ 2004, the​ city's
    14·1 answer
  • if u buy a phone from wish.com and u don't have a service carrier if they give u their number can u still text them even though
    11·1 answer
  • Beatrice invests $1,320 in an account that pays 4 percent simple interest. How much more could she have earned over a 5-year per
    10·1 answer
  • Consider the market for pens. Suppose that a new educational study has proven that the practice of writing, erasing, and rewriti
    8·1 answer
  • At the end of 2016, Splish Brothers Inc. has accounts receivable of $675,100 and an allowance for doubtful accounts of $24,370.
    9·1 answer
  • On November 1, 2021, Taylor signed a one-year contract to provide handyman services on an as-needed basis to King Associates, wi
    13·1 answer
  • you work at an electronYou work at a local electronics store, Electronics Warehouse. While you are working you spot a customer w
    7·1 answer
  • If the reserve requirement is 20% and commercial bankers decide to hold additional excess reserves equal to 5% of any newly acqu
    7·1 answer
  • The difference between the price charged for a product and the cost to manufacture it is referred to as the?
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!