Property Valuation
An Indianapolis apartment building generates a NOI of $72,000 per year. If comparable properties have a cap rate of 7.5%, what is the estimated value?
A$540,000
B$720,000
C$960,000✓ Correct
D$1,200,000
Explanation
Value = NOI ÷ Cap Rate = $72,000 ÷ 0.075 = $960,000.
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