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Optimal Capital Structure in Real Estate Investment: A Real Options Approach

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Figure

Figure 1  The  Effect  of  an  Increase  in  Either  the  Sunk  Cost  or  the  Risk of Investment
Table 1  Determinants  of  the  Investment  Timing  and  Loan-to-Value  Ratio.
Table 1 shows the results for f changes in the region (0.5, 1.5), τ in the region  (10%, 30%), ρ in the region (11.5%, 12.5%), n in the region (31, 47), δ in the  region (0.4, 0.6), λ 1  in the region (0.045, 0.055), λ 2  in the region (0, 0.02), σ in  the
Figure 2  The  Effect  of  an  Increase  in  Either  the  Tax  Rate  or  the  Length of Depreciation for Tax Purposes, or  A Decrease in  Depreciable Capital
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