Real Estate Math
A Hawaii rental with potential gross income of $60,000 has operating expenses of $24,000. What is the operating expense ratio?
AA. 35%
BB. 40%✓ Correct
CC. 45%
DD. 30%
Explanation
Operating Expense Ratio = Operating Expenses / EGI = $24,000 / $60,000 = 0.40 = 40%. Using the values given ($60,000, $24,000), apply the appropriate formula.. The correct answer is B. 40%.. This is a common calculation on the Hawaii real estate exam.
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