Real Estate Math
A Michigan property is being appraised using the cost approach. The lot is worth $50,000, the building's reproduction cost is $320,000, and total depreciation is 25%. What is the indicated value?
A$240,000
B$290,000✓ Correct
C$300,000
D$320,000
Explanation
Depreciated building value = $320,000 x (1 - 0.25) = $240,000. Total value = $240,000 + $50,000 land = $290,000.
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