ASC Investment Metrics 2

Question 1

In ARGUS Enterprise, which metric represents the ratio of net operating income to the total acquisition cost of a property?

Accepted Answer

Capitalization Rate (Going-In Cap Rate)

Answer

Equity Dividend Rate

Answer

Internal Rate of Return

Answer

Cash-on-Cash Return

Question 2

Which ARGUS output measure reflects the total return to an investor including both income and appreciation, expressed as a single annualized percentage?

Accepted Answer

Internal Rate of Return (IRR)

Answer

Net Present Value

Answer

Equity Multiple

Answer

Debt Service Coverage Ratio

Question 3

A property has a NOI of $850,000 and is sold at a 6.5% terminal cap rate. What is the reversion value?

Accepted Answer

$13,076,923

Answer

$5,525,000

Answer

$5,850,000

Answer

$6,250,000

Question 4

In ARGUS Enterprise, the 'Equity Multiple' of 2.0x means the investor:

Accepted Answer

Doubled their total equity investment over the holding period

Answer

Earned a 20% annual return

Answer

Received twice the property's NOI in cash

Answer

Achieved an IRR of 200%

Question 5

Which scenario would most likely DECREASE the unleveraged IRR in an ARGUS model?

Accepted Answer

Increasing the residual cap rate assumption

Answer

Shortening the holding period with strong rental growth

Answer

Decreasing the discount rate

Answer

Adding above-market leases to the rent roll

Question 6

What does the 'Debt Service Coverage Ratio' (DSCR) measure in an ARGUS investment analysis?

Accepted Answer

NOI divided by annual debt service payments

Answer

The ratio of equity to total debt

Answer

Gross income divided by total expenses

Answer

The loan-to-value ratio at acquisition

Question 7

In ARGUS Enterprise, which analysis compares the present value of all future cash flows to the initial investment to measure value creation?

Accepted Answer

Net Present Value (NPV) Analysis

Answer

Sensitivity Analysis

Answer

Debt Yield Analysis

Answer

Break-Even Analysis