Real Estate Math
A property's net operating income (NOI) is $48,000 and the cap rate is 8%. What is the estimated property value using the income approach?
A$384,000
B$600,000✓ Correct
C$480,000
D$3,840,000
Explanation
Value = NOI / Cap Rate = $48,000 / 0.08 = $600,000.
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