Property Valuation
An appraiser calculates an 'effective gross income multiplier' (EGIM) for a New Mexico apartment complex. To find EGIM, the appraiser divides:
ANet operating income by sales price
BSales price by effective gross income✓ Correct
CPotential gross income by vacancy rate
DCap rate by sales price
Explanation
EGIM = Sales Price / Effective Gross Income (EGI). EGI equals potential gross income minus vacancy and credit losses.
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