Real Estate Math
A commercial property in Connecticut has an NOI of $60,000. If the cap rate is 8%, what is the property value?
A$480,000
B$600,000
C$750,000✓ Correct
D$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 Connecticut real estate exam.
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