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After the 5 years of occupancy, these charges are offset from the money with the lease, in addition a profit to the loss element, and Various other charges are integrated. Due to this fact, the real-estate operator would not get from the occupancy.

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e. CAGR (compound normal development return). A cash Trader is definitely thinking about The online return acquired 12 months just after yr, Hence usage of geometric is much more acceptable. Hence we would use geometric average for hazard free of charge amount and hazard premium for every of the three divisions, as presented in exhibit 5 from the case.

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