Real Estate Math
An investment property in Baton Rouge has a potential gross income of $84,000, a 5% vacancy rate, and operating expenses of $28,000. What is the net operating income (NOI)?
A$51,800✓ Correct
B$51,400
C$52,200
D$50,800
Explanation
Effective Gross Income = $84,000 − ($84,000 × 5%) = $84,000 − $4,200 = $79,800. NOI = EGI − Operating Expenses = $79,800 − $28,000 = $51,800.
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