Real Estate Math
An upstate New York commercial property has an NOI of $80,000 and is purchased at a 6.4% cap rate. What is the purchase price?
A$512,000
B$1,000,000
C$1,250,000✓ Correct
D$1,500,000
Explanation
Purchase Price = NOI / Cap Rate = $80,000 / 0.064 = $1,250,000.
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