Real Estate Math
A commercial property in Salem generates gross rents of $180,000/year. Vacancy and collection losses are 8%. Operating expenses are $62,000. What is the net operating income?
A$103,600✓ Correct
B$104,000
C$118,000
D$101,600
Explanation
Effective Gross Income = $180,000 × (1 - 0.08) = $180,000 × 0.92 = $165,600. NOI = EGI - Operating Expenses = $165,600 - $62,000 = $103,600.
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