Property Valuation
What does 'net operating income' (NOI) represent for an income property?
AGross rent minus mortgage payments
BGross income minus vacancy, credit losses, and operating expenses (before debt service)✓ Correct
CTotal revenue minus all taxes
DMonthly rent multiplied by 12
Explanation
NOI = Gross Potential Income − Vacancy & Credit Losses − Operating Expenses. It represents the income before debt service (mortgage payments) and income taxes.
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