Real Estate Math
An investment property has a gross income of $60,000 per year and an operating expense ratio of 45%. What is the NOI?
A$27,000
B$33,000✓ Correct
C$45,000
D$60,000
Explanation
NOI = Gross Income × (1 − Expense Ratio) = $60,000 × (1 − 0.45) = $60,000 × 0.55 = $33,000. To solve this, multiply the relevant values: $60,000 at 45%.. The correct answer is $33,000.. This is a common calculation on the Iowa real estate exam.
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