Consider an investment in which a developer plans to begin construction, of a building that will cost $1,000,000, in one year if, at that point, rent levels make construction feasible. There is a 50 percent chance that NOI will be $160,000 and a 50 percent chance that NOI will be $80,000. Assuming a cap rate of 10 percent (12 percent discount rate and an NOI growth rate of 2 percent) what would the land value be at the completion of the construction, under the "Real Options" approach?

This problem has been solved! see the answerwhich of the following statements is correct? the consumer price index is a measure of the overall level of prices, whereas the gdp deflator is not a measure of the overall level of prices. if, in the year 2011, the consumer price index has a value of 123.50, then the inflation rate for 2011 must be 23.50 percent. compared to the gdp deflator, the consumer price index is the more common gauge of inflation. the consumer price index and the gdp deflator reflect the goods and services bought by consumers equally well.