Real Estate Math
A Hawaii rental property's gross rent is $84,000/year and the operating expense ratio is 40%. What is the cap rate if the property sold for $1,050,000?
AA. 4.8%✓ Correct
BB. 4.6%
CC. 5.0%
DD. 5.2%
Explanation
NOI = $84,000 × (1-0.40) = $84,000 × 0.
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