Real Estate Math
A Rhode Island rental property has potential gross income of $75,000, vacancy of 5%, and total operating expenses of $28,500. What is the net operating income?
A$42,750✓ Correct
B$43,650
C$45,000
D$46,500
Explanation
EGI = $75,000 x (1 - 0.05) = $75,000 x 0.95 = $71,250. NOI = $71,250 - $28,500 = $42,750. To solve this, multiply the relevant values: $75,000, and $28,500 at 5%.. The correct answer is $42,750.. This is a common calculation on the Rhode Island real estate exam.
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