Real Estate Math
A Florida commercial property generates $120,000 annual NOI. An investor requires a 10% return. What should the investor pay for this property?
A$1,000,000
B$1,200,000✓ Correct
C$900,000
D$1,100,000
Explanation
Value = NOI ÷ Required Rate of Return = $120,000 ÷ 0.10 = $1,200,000.
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