Real Estate Math
A building has a net rentable area of 50,000 sq ft. The base rent is $20/sq ft/year. The building has 10% vacancy. What is the effective gross income (assuming no other income)?
A$900,000✓ Correct
B$800,000
C$1,000,000
D$850,000
Explanation
PGI = 50,000 × $20 = $1,000,000. EGI = $1,000,000 × (1 − 10%) = $1,000,000 × 0.
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