Real Estate Math
A property produces an NOI of $85,000. If cap rates in the market are 7%, what is the value?
A$1,000,000
B$1,200,000
C$1,214,286✓ Correct
D$850,000
Explanation
Value = NOI ÷ Cap Rate = $85,000 ÷ 0.07 = $1,214,285.
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