Property Valuation
The principle of substitution in Nevada appraisal theory states that:
AA property's value is determined by its highest and best use
BA buyer will not pay more for a property than the cost of an equally desirable substitute✓ Correct
CThe value of any component is what it adds to the whole
DAll land in the same area has the same value
Explanation
The principle of substitution is the foundation of all three appraisal approaches: a rational buyer will not pay more for a property than the cost of acquiring an equally desirable substitute property.
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