Real Estate Math
A Missouri commercial building has an NOI of $48,000 and a market cap rate of 9%. The estimated value is:
A$432,000
B$480,000
C$533,333✓ Correct
D$576,000
Explanation
Value = NOI ÷ Cap rate = $48,000 ÷ 0.09 = $533,333. To solve this, multiply the relevant values: $48,000 at 9%.. The correct answer is $533,333.. This is a common calculation on the Missouri real estate exam.
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