Real Estate Math
A Mississippi investor uses a gross rent multiplier of 100 to value a property with annual gross rent of $18,000. The estimated value is:
A$18,000
B$150,000✓ Correct
C$100,000
D$1,800,000
Explanation
When using annual GRM, Value = Annual GRM × Annual Gross Rent = 100 × $18,000 = $1,800,000. However, if monthly GRM is 100: Value = 100 × ($18,000 ÷ 12) = 100 × $1,500 = $150,000.
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