Mason Corporation Is Considering Purchasing Rental Property That Provides Annual

Mason corporation is considering purchasing rental property that provides annual cash flows of $800,000. Rent is expected to increase by 1.8% annually for the foreseeable future. If Mason's
Return requirement is 12.8% and the rental property is listed at $7,500,000 determine if the property
Is over or under valued from Mason's perspective.

A) Listed property is over-valued by $227,272.
B) Listed property is under-valued by $227,272.
C) Listed property is over-valued by $292,727.
D) Listed property is under-valued by $292,727
E) Listed property is priced correctly.