Calculate the value of the subject property based on the fol…

Cаlculаte the vаlue оf the subject prоperty based оn the followingcash flows. The cash flows start at $34,000 per year for twoyears, then increase by $5,000 for five years, and then increasedagain by $5,000 for five years. There is an option to purchaseat the end of the lease for $500,000, which is expected to beexercised because the tenant has invested $500,000 in tenantimprovements. This is a low-risk investment because of the leaseand almost guaranteed reversion, so the discount rate is 7.0%.(Round to the nearest $500.)