Property Valuation
A Florida commercial appraiser uses 'discounted cash flow' (DCF) analysis. The key inputs include:
AOnly current NOI and a cap rate
BProjected future income streams, a terminal value at the end of the holding period, and a discount rate reflecting required return✓ Correct
CHistorical income and the cost approach value
DThe gross rent multiplier and vacancy rate only
Explanation
DCF analysis projects the property's future income streams (typically 10 years), estimates a terminal (reversion) value at the end of the holding period, and discounts all future cash flows back to present value using a required rate of return (discount rate).
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