Real Estate Math
A Mississippi property earns $5,200 per month in rent. The operating expense ratio is 40%. The NOI is:
A$62,400
B$37,440✓ Correct
C$31,824
D$24,960
Explanation
Annual gross income = $5,200 × 12 = $62,400. Operating expenses = $62,400 × 0.40 = $24,960. NOI = $62,400 - $24,960 = $37,440. The operating expense ratio of 40% means expenses consume 40% of gross income, leaving 60% as NOI.
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