Answer either one of the questions below, or diversify your portfolio by answering both.

If you answer both, we will grade both and assign each question half of the 20% for this part.

If you answer only one, that one you answer will get the full 20%.

Please be sure it is clear to us which question(s) you want to be graded.

If the TA cannot figure it out on her own, she will grade both.

This land produces no income but owes 2% of its value per year in property taxes.

Meanwhile, typical income properties are yielding 9% (that is, they have a current cash yield, or "cap rate", of 9%).

If inflation is expected to be around 3% per year, and you expect your land will appreciate at 10% per year,

what should you do with this land parcel? (Be specific and please explain why you should do what you say.)