Real Estate Math
A NJ buyer pays $25 per square foot per year for a 2,800 sq ft commercial space. If the lease includes an annual 3% rent escalation, what is the rent in Year 2?
A$72,100✓ Correct
B$72,240
C$72,520
D$74,100
Explanation
Year 1 rent = $25 × 2,800 = $70,000. Year 2 rent = $70,000 × 1.03 = $72,100. To solve this, multiply the relevant values: $25 at 3%.. The correct answer is $72,100.. This is a common calculation on the New Jersey real estate exam.
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