Real Estate Math
A house has 2,200 sq ft of living area. The cost to replace it is $90 per sq ft. The land value is $55,000. Total depreciation is estimated at 15%. What is the property value using the cost approach?
AA. $223,700✓ Correct
BB. $253,700
CC. $198,000
DD. $198,000
Explanation
Building replacement cost = 2,200 × $90 = $198,000. Less depreciation: $198,000 × 15% = $29,700.
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