Property Valuation
For a Kentucky investment property, the cap rate is 7.5%. If the asking price is $800,000, what NOI is implied?
A$48,000
B$60,000✓ Correct
C$72,000
D$80,000
Explanation
NOI = Value × Cap Rate = $800,000 × 7.5% = $60,000. To solve this, multiply the relevant values: $800,000, at 7.5%.. The correct answer is $60,000.. This is a common calculation on the Kentucky real estate exam.
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