Real Estate Math
A 40-acre parcel is being sold for $3,500 per acre. What is the total purchase price?
A$140,000✓ Correct
B$14,000
C$1,400,000
D$350,000
Explanation
40 acres × $3,500/acre = $140,000. Using the values given ($3,500), apply the appropriate formula..
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Key Terms to Know
Loan-to-Value Ratio (LTV)
The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
AmortizationThe gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
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