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Mr. Sam Golff desires to invest a portion of his assets in rental property. He has narrowed his c...

Mr. Sam Golff desires to invest a portion of his assets in rental property. He has narrowed his choices down to two apartment complexes, Palmer Heights and Crenshaw Village. After conferring with the present owners, Mr. Golff has developed the following estimates of the cash flows for these properties.

Palmer Heights Yearly Aftertax Cash Inflow (in thousands) Probability $ 30 .2 35 .2 50 .2 65 .2 70 .2 Crenshaw Village Yearly Aftertax Cash Inflow (in thousands) Probability $ 35 .4 40 .2 50 .1 60 .3

A. Find the expected cash flow from each apartment complex.

b. What is the coefficient of variation for each apartment complex?

c. which apartment complex has more risk?

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Answer #1

afico coms ders n^ expected value DP 30 35 50 G 5 70 6-27 40 . 13 GO o313- 0-2 DP SoCb) somdasdl deuata 卩Heights Ressen斗 PPI DP [d.00) (tp.0がー.@j_| 235-225 415 2 4010 2.o 100 3 20 260 c 10 D 12-2, o.25692563 2 225u5 20 5 o2 3015 2 3 4 leo As 0.2 |65 | 20 150 】2-24 2 122y 2 o. 222 villages lo、242.256 232 iatio The cecfficiem of osla+o rneavaze) aton

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