Property Valuation
A Maine appraisal uses the income capitalization approach. A property generates $36,000 net operating income annually. Using a 6% cap rate, the indicated value is:
A$216,000
B$300,000
C$600,000✓ Correct
D$2,160,000
Explanation
Value = NOI / Cap Rate = $36,000 / 0.06 = $600,000.
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