Property Valuation
An appraiser uses the cost approach to value a Colorado commercial property. The replacement cost new is $800,000 and the property has 25% depreciation. The land is worth $150,000. What is the indicated value?
A$600,000
B$700,000
C$750,000✓ Correct
D$950,000
Explanation
Depreciated building value = $800,000 × (1 − 0.25) = $800,000 × 0.75 = $600,000. Total indicated value = $600,000 + $150,000 land = $750,000.
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