Property Valuation
A property generates $60,000 in annual net operating income. If the cap rate is 8%, what is the property's estimated value?
A$480,000
B$750,000✓ Correct
C$600,000
D$4,800,000
Explanation
Value = NOI ÷ Cap Rate = $60,000 ÷ 0.08 = $750,000. To solve this, multiply the relevant values: $60,000 at 8%.. The correct answer is $750,000.. This is a common calculation on the Alabama real estate exam.
Related Alabama Property Valuation Questions
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