Property Valuation
The principle of contribution states that the value of an improvement is measured by:
AIts cost of construction
BHow much it adds to the total market value of the property✓ Correct
CThe replacement cost less depreciation
DThe income it generates for the owner
Explanation
Contribution measures value by what an improvement adds to the overall property value — not its cost. A $30,000 kitchen remodel that adds only $20,000 of value has a contribution of $20,000.
Related Arkansas Property Valuation Questions
- Which of the following most accurately describes 'market rent'?
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