Exam 2

Question 1

What’s this formula and how do you use it?

Answer 1

Vn = value “n” years in future

n = number of years of payment

i = interest or discount rate

Question 2

What’s this formula and how do you use it?

Answer 2

Question 3

What’s this formula and how do you use it?

Answer 3

Question 4

What’s this formula and how do you use it?

Answer 4

Question 5

What’s this formula and how do you use it?

Answer 5

Question 6

What’s this formula and how do you use it?

Answer 6

Question 7

Explain LEV

Answer 7

Land expectation value - real estate has the ability to be productive forever if managed well. LEV can tell you the value of a bare piece of land used in a specific way (timber, farming, etc.) in perpetuity. It is a comparison and analysis tool for comparing values of tracts of land.

Question 8

What is this formula and what is it used for?

Answer 8

Question 9

What is this formula and what is it used for?

Answer 9

Question 10

What is this formula and what is it used for?

Answer 10

Question 11

What is this formula and what is it used for?

Answer 11

R = net return of one rotation in future dollars

r - rotation in years