Real Estate Math
A Florida property's annual gross income is $96,000. Vacancy is 8%, operating expenses are $32,000. At a 9% cap rate, the value is:
A$625,778✓ Correct
B$800,000
C$711,111
D$820,000
Explanation
Vacancy = $96,000 × 8% = $7,680. EGI = $88,320. NOI = $88,320 − $32,000 = $56,320. Value = $56,320 ÷ 0.09 ≈ $625,778. Closest with rounding: various. Direct: $56,320 ÷ 0.09 = $625,778.
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