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period. The QMDM consists of various summary tables in
which implied marketability discounts are enumerated for
each set of the above four factors.
As to this case, Dr. Kursh assumed the expected growth
rate of value to be between 3 and 4 percent. Dr. Kursh
based this determination on the historical inflation rate.
He assumed the expected distribution yield to be 10
percent, based on the yields for comparable real estate
investments. He assumed a required holding period return
of 16.4 percent. This percentage was calculated using the
rates of return on publicly traded securities as modified
by specific characteristics of the particular investment.
And lastly, Dr. Kursh assumed a holding period of 10 to
15 years. From the QMDM tables, Dr. Kursh's assumptions
produced a marketability discount of 15 percent.
After applying the 15-percent marketability discount,
Dr. Kursh concluded that the fair market value of the
subject limited partnership interest on the date of death
is $1,770,103. Dr. Kursh's analysis is summarized as
follows:
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